LEASESThe Company leases office and manufacturing space in Wilsonville, Oregon under operating leases. In October 2025, the Company exercised renewal options for the leases which were not previously included in the operating lease assets or obligations. These renewals resulted in an increase of $3.8 million to the Company’s right-of-use (“ROU”) assets and lease liabilities and extension of the leases through December of 2027.
The Company determines if an arrangement is a lease at inception and whether the arrangement is classified as an operating or finance lease. At commencement of the lease, the Company records an ROU asset and lease liability in the consolidated balance sheets based on the present value of lease payments over the term of the arrangement. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. As the Company’s leases do not provide an implicit rate, it uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The Company determines its incremental borrowing rate based on publicly available data for instruments with similar characteristics, including recently issued debt, as well as other factors. Contract terms may include options to extend or terminate the lease. The Company includes these options in the recognition of its ROU assets and lease liabilities when it is reasonably certain that it will exercise the option. Operating leases reflect lease expense on a straight-line basis, while finance leases will result in the separate presentation of interest expense on the lease liability and amortization expense of the ROU asset.
ROU assets related to the Company’s operating leases are included in operating lease ROU assets, while the corresponding lease liabilities are included in current and non-current operating lease liabilities on the Company’s consolidated balance sheets. ROU assets related to the Company’s finance leases are included in other non-current assets, while the corresponding lease liabilities are included in accrued and other current liabilities and other non-current liabilities on the Company’s consolidated balance sheets.
The Company does not record leases with a term of 12-months or less in the consolidated balance sheets. Short-term lease costs were immaterial for the year ended December 31, 2025.
Operating lease expense for the years ended December 31, 2025 and 2024 was $1.7 million. Finance lease costs for the years ended December 31, 2025 and 2024 were immaterial.
As of December 31, 2025, future maturities of lease liabilities are as follows (in thousands):
| | | | | |
| Operating Leases |
| 2026 | 2,123 | |
| 2027 | 2,186 | |
| Thereafter | — | |
| Total minimum lease payments | $ | 4,309 | |
| Less: imputed interest | (465) | |
| Present value of lease liabilities | $ | 3,844 | |
Weighted-average remaining lease term and discount rate are as follows:
| | | | | | | | | | | |
| December 31, 2025 | | December 31, 2024 |
| Weighted-average remaining lease term (in years) | 2.0 | | 1.0 |
| Weighted-average discount rate | 11.1 | % | | 9.9 | % |