The Company has made certain assumptions and judgments when applying ASC 842 including the adoption of the package of practical expedients available for transition. The practical expedients allowed the Company to not reassess (i) whether expired or existing contracts contained leases, (ii) lease classification for expired or existing leases and (iii) previously capitalized initial direct costs. The Company also elected not to recognize right-of-use assets and lease liabilities for short-term leases (leases with a term of twelve months or less).

Operating lease arrangements primarily consist of office and warehouse leases expiring at various years through 2028. The facility leases have original lease terms of two to seven years and contain options to extend the lease up to 5 years or terminate the lease. Options to extend are included in leased right-of-use assets and lease liabilities in the condensed consolidated balance sheet when the Company is reasonably certain it will renew the underlying leases. The Company has elected to apply a collateralized incremental borrowing rate to facility leases on the original lease term in calculating the present value of future lease payments.

As of March 31, 2026 and December 31, 2025, the weighted average discount rate for operating leases was 6.42% and the weighted average remaining lease term for operating leases was 2.2 and 2.4 years, respectively.

The Company has entered into various short-term operating leases for office and warehouse space, with an initial term of twelve months or less. These short-term leases are not recorded on the Company’s condensed consolidated balance sheets. The components of lease expense and other information for three months ended March 31, 2026 and 2025 were as follows.


	Three Months Ended March 31,
	2026		2025
	(in thousands)
Operating lease costs	$	36	$	82
Variable lease costs		13		36
Short-term lease costs		1		10
Total lease costs		50		128
Other information:
Cash paid for amounts included in the measurement of operating lease liability	$	50	$	118

The following represents the Company’s minimum annual rental payments under operating leases for each of the next five years and thereafter:


Fiscal Year Ending December 31,	Operating
	(in thousands)
2026 (remaining)		115
2027		145
2028		63
2029		—
Thereafter		—
Total future minimum lease payments		323
Less: imputed interest		(28	)
Present value of operating lease liability	$	295

Current portion of lease liability		143
Non-current portion of lease liability		152
Present value of operating lease liability	$	295