v3.26.1
LEASES
 6 Months Ended
Jun. 30, 2026
Leases [Abstract]  
LEASES LEASES
We have entered into various operating lease agreements for offices, manufacturing and warehouse facilities.
We lease the Union City, Indiana manufacturing facility from an affiliate of MGMH, a related party, pursuant to a lease agreement with an initial term of 20 years that commenced in August 2025. We have the option to renew the lease for six additional 5-year renewal terms, subject to the terms of the lease. After the conclusion of a six-month abatement period that ended in February 2026, base annual rent is $2.1 million and is subject to an annual increase of 3% during the initial term of the lease and certain additional increases during any renewal term. In April 2026, the parties to the lease entered into an agreement whereby the lessor agreed to a deferral of the Company’s monthly rental payments for five months beginning May 2026, with the entire deferred amount due and payable in a single lump-sum payment on or before September 30, 2026. In August 2026, the parties to the lease entered into an agreement whereby the lessor agreed to a further deferral of the Company’s monthly rental payments, as further described in Note 16, Subsequent Events.
We determine if an arrangement is a lease, or contains a lease provision, at inception and record the leases in our Condensed Consolidated Financial Statements upon lease commencement, which is the date when the underlying asset is made available for our use by the lessor.
As permitted by ASC 842, “Leases”, we have elected not to record in the Condensed Consolidated Balance Sheets leases with a lease term of 12 months or less at lease inception that do not contain a purchase option or renewal term provision we are reasonably certain to exercise. All other lease right-of-use (“ROU”) assets and lease liabilities are recognized based on the present value of lease payments over the lease term at commencement date. Because most of our leases do not provide an implicit rate of return, we used our incremental borrowing rate based on the information available at lease commencement date in determining the present value of lease payments.
Our leases may include options to extend the lease term for up to 5 years. Some of our leases also include options to terminate the lease prior to the end of the agreed upon lease term. For the purpose of calculating lease liabilities, lease terms include options to extend or terminate the lease when it is reasonably certain we will exercise such options.

Lease expense for operating leases is recognized on a straight-line basis over the lease term as either cost of sales or operating expenses depending on the nature of the leased asset.
During the three and six months ended June 30, 2026 and 2025, we did not identify any indicators of impairment of ROU assets, and no impairment losses were recognized during the periods.
The components of lease expense are as follows in our Condensed Consolidated Statements of Operations:
Three Months Ended June 30,Six Months Ended June 30,
(in thousands)2026202520262025
Short-term lease expense$106 $35 $106 $70 
Operating lease expense1,370 334 2,815 627 
Total lease expense$1,476 $369 $2,921 $697 
Sublease income$104 $— $127 $— 
Lease right-of-use assets consisted of the following:
(in thousands)June 30, 2026December 31, 2025
Operating lease right-of-use assets$20,373 $21,872 

Lease liabilities consisted of the following:
(in thousands)June 30, 2026December 31, 2025
Current portion operating lease liabilities$1,312 $3,616 
Long-term operating lease liabilities20,652 18,777 
Operating lease liabilities$21,964 $22,393 
LEASES LEASES
We have entered into various operating lease agreements for offices, manufacturing and warehouse facilities.
We lease the Union City, Indiana manufacturing facility from an affiliate of MGMH, a related party, pursuant to a lease agreement with an initial term of 20 years that commenced in August 2025. We have the option to renew the lease for six additional 5-year renewal terms, subject to the terms of the lease. After the conclusion of a six-month abatement period that ended in February 2026, base annual rent is $2.1 million and is subject to an annual increase of 3% during the initial term of the lease and certain additional increases during any renewal term. In April 2026, the parties to the lease entered into an agreement whereby the lessor agreed to a deferral of the Company’s monthly rental payments for five months beginning May 2026, with the entire deferred amount due and payable in a single lump-sum payment on or before September 30, 2026. In August 2026, the parties to the lease entered into an agreement whereby the lessor agreed to a further deferral of the Company’s monthly rental payments, as further described in Note 16, Subsequent Events.
We determine if an arrangement is a lease, or contains a lease provision, at inception and record the leases in our Condensed Consolidated Financial Statements upon lease commencement, which is the date when the underlying asset is made available for our use by the lessor.
As permitted by ASC 842, “Leases”, we have elected not to record in the Condensed Consolidated Balance Sheets leases with a lease term of 12 months or less at lease inception that do not contain a purchase option or renewal term provision we are reasonably certain to exercise. All other lease right-of-use (“ROU”) assets and lease liabilities are recognized based on the present value of lease payments over the lease term at commencement date. Because most of our leases do not provide an implicit rate of return, we used our incremental borrowing rate based on the information available at lease commencement date in determining the present value of lease payments.
Our leases may include options to extend the lease term for up to 5 years. Some of our leases also include options to terminate the lease prior to the end of the agreed upon lease term. For the purpose of calculating lease liabilities, lease terms include options to extend or terminate the lease when it is reasonably certain we will exercise such options.

Lease expense for operating leases is recognized on a straight-line basis over the lease term as either cost of sales or operating expenses depending on the nature of the leased asset.
During the three and six months ended June 30, 2026 and 2025, we did not identify any indicators of impairment of ROU assets, and no impairment losses were recognized during the periods.
The components of lease expense are as follows in our Condensed Consolidated Statements of Operations:
Three Months Ended June 30,Six Months Ended June 30,
(in thousands)2026202520262025
Short-term lease expense$106 $35 $106 $70 
Operating lease expense1,370 334 2,815 627 
Total lease expense$1,476 $369 $2,921 $697 
Sublease income$104 $— $127 $— 
Lease right-of-use assets consisted of the following:
(in thousands)June 30, 2026December 31, 2025
Operating lease right-of-use assets$20,373 $21,872 

Lease liabilities consisted of the following:
(in thousands)June 30, 2026December 31, 2025
Current portion operating lease liabilities$1,312 $3,616 
Long-term operating lease liabilities20,652 18,777 
Operating lease liabilities$21,964 $22,393