Annual report pursuant to Section 13 and 15(d)

Commitments and Contingencies

v3.24.1
Commitments and Contingencies
12 Months Ended
Dec. 31, 2023
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies

12. COMMITMENTS AND CONTINGENCIES

 

The following table summarizes our contractual obligations as of December 31, 2023 (in thousands):

 

 

 

Total

 

 

Less than 1 year

 

 

1-3 years

 

 

3-5 years

 

 

More than 5 years

 

Vancouver office operating lease

 

$

74

 

 

$

68

 

 

$

6

 

 

$

 

 

$

 

Total

 

$

74

 

 

$

68

 

 

$

6

 

 

$

 

 

$

 

 

Leases

We have an operating lease for our corporate office.

Operating leases with a term of 12 months or longer are included in ROU assets, other current liabilities, and operating lease liabilities on our consolidated balance sheets. Finance leases are included in property and equipment, other current liabilities, and other long-term liabilities on our consolidated balance sheets.

Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, we use the incremental borrowing rate of comparable companies from a representative peer group selected based on industry and market capitalization. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.

Vancouver Lease Arrangements

On November 19, 2018, we entered into a lease agreement for new office space in Vancouver, British Columbia, which commenced on February 1, 2019, and has a four-year term. Pursuant to this lease, we rent approximately 2,367 square feet of office space. On December 16, 2022, we entered into an agreement to extend the lease for another two-year term, which commenced on February 1, 2023. Pursuant to this lease, we rent approximately 2,367 square feet of office space. The annual rent is approximately $0.1 million.

The future minimum annual lease payments under the Vancouver lease are as follows (in thousands):

2024

 

 

68

 

2025

 

 

6

 

Total

 

$

74

 

 

Consolidated rent and operating expense relating to both the Vancouver, Canada and Seattle, Washington offices for years ended December 31, 2023, 2022 and 2021 was $0.1 million, $0.1 million and $0.1 million, respectively.

 

Other information related to leases was as follows:

 

 

 

Year Ended

 

 

December 31,

 

 

2023

 

 

2022

 

 

Supplemental Cash Flows Information

 

 

 

 

 

 

 

Cash paid for amounts included in the measurement of lease liabilities:

 

 

 

 

 

 

 

Operating cash flows from operating leases

 

$

57

 

 

$

59

 

 

Right-of-use assets obtained in exchange for lease obligations:

 

 

 

 

 

 

 

Operating leases

 

$

 

 

 

120

 

 

Weighted Average Remaining Lease Term

 

 

 

 

 

 

 

Operating leases

 

1.08 years

 

 

2.08 years

 

 

Weighted Average Discount Rate

 

 

 

 

 

 

 

Operating leases

 

 

8.98

%

 

 

8.98

%

 

 

Guarantees and Indemnifications

We indemnify our officers, directors and certain consultants for certain events or occurrences, subject to certain limits, while the officer or director is or was serving at its request in such capacity. The term of the indemnification period is equal to the officer’s or director’s lifetime.

The maximum amount of potential future indemnification is unlimited; however, we have obtained director and officer insurance that limits our exposure and may enable us to recover a portion of any future amounts paid. We believe that the fair value of these indemnification obligations is minimal. Accordingly, we have not recognized any liabilities relating to these obligations as of December 31, 2023.

We have certain agreements with certain organizations with which it does business that contain indemnification provisions pursuant to which it typically agrees to indemnify the party against certain types of third-party claims. We accrue for known indemnification issues when a loss is probable and can be reasonably estimated. There were no accruals for or expenses related to indemnification issues for any period presented.