Note 12. Leases

The Company’s leases consist primarily of operating leases for administrative office space, research and development facilities, a manufacturing facility, and sales offices in various countries around the world. The Company determines if an arrangement is a lease at inception. Some lease agreements contain lease and non-lease components, which are accounted for as a single lease component. Total rent expense was $155,000 and $243,000 for the three months ended March 31, 2026 and 2025, respectively.

Initial lease terms are determined at commencement and may include options to extend or terminate the lease when it is reasonably certain the Company will exercise the option. Remaining lease terms range from one to three years, some of which include options to extend for up to five years. Leases with an initial term of 12 months or less are not recorded on the condensed consolidated balance sheets. As the Company’s leases do not provide an implicit rate, the present value of future lease payments is determined using the Company’s incremental borrowing rate based on information available at the lease commencement date.

As of March 31, 2026, the weighted average remaining lease term for the Company’s operating leases was 1.9 years, and the weighted average discount rate used to determine the present value of the Company’s operating leases was 7.8%.

Cash paid for amounts included in the measurement of operating lease liabilities was $114,000 and $264,000 for the three months ended March 31, 2026 and 2025, respectively.