During March 2020, the Company entered into a lease for its U.S. commercial office in Rockville, Maryland for a total of 30,531 square feet of office space. The lease has a remaining term of approximately seven years and has an option to extend for two five-year periods after the initial term of 11 years has elapsed and has an option to terminate after seven years. As of September 30, 2024, the Company had a right-of-use (ROU) asset of $4.1 million and lease liability of $6.8 million included in the condensed consolidated balance sheets. As of December 31, 2023, the Company had a right-of-use asset of $4.5 million and lease liability of $7.4 million included in the condensed consolidated balance sheets. The Company recorded leasehold improvement incentives in the amount of $2.3 million as additions to the lease liability.

When measuring the lease liability, the Company discounted lease payments using its incremental borrowing rate at the lease commencement date on March 12, 2020. The incremental borrowing rate applied to the lease liability was 5.2% based on the financial position of the Company, geographical region and term of lease.

During October 2022, the Company entered into a long term lease in Edmonton for a total of 4,375 square feet of office space. The lease is a six year lease and has an option to renew after five years at prevailing market rates. The lease commenced on November 1, 2022 and the Company recorded the lease as an operating lease. The lease is not material to the Company's financial position.

For all leases, the Company incurs variable lease costs. These costs include operation and maintenance costs included in SG&A and are expensed as incurred. The variable lease costs are not material to the Company's financial position.

The operating lease costs for all leases for the three and nine months ended September 30, 2024, and September 30, 2023, were $0.2 million and $0.6 million, respectively.

At lease inception, the Company recorded an ROU asset of approximately $117.6 million and a corresponding lease liability of $94.1 million, which is the present value of the minimum lease payments beginning July 2023 and expiring in 2030. The incremental borrowing rate applied to value the lease liability at inception is 6.19%, which was based on the financial position of the Company, geographical region and term of lease. As the monoplant finance lease is denominated in Swiss francs, the company incurs unrealized and realized foreign exchange gains and losses each reporting period related to the valuation of the lease liability and timing of lease payments.

As of September 30, 2024, the ROU asset, net and corresponding lease liability balance were $95.6 million and $80.7 million, respectively. As of December 31, 2023, the ROU asset, net and corresponding lease liability balance were $108.7 million and $90.1 million, respectively. For the three and nine months ended September 30, 2024, ROU amortization was $4.4 million and $13.1 million, respectively. For the three and nine months ended September 30, 2024, interest expense was $1.2 million and $3.7 million, respectively.

The Company entered into an equipment and facility finance lease for a backup manufacturing encapsulation site in Beinheim, France that commenced operations during June 2024 with a lease term of seven years. The incremental borrowing rate applied to value the lease liability at inception is 6.19%, which was based on the financial position of the Company, geographical region and term of lease.


	Nine Months Ended September 30,
	2024		2023
	(in thousands)
Cash paid for amounts included in the measurement of lease liabilities
Financing cash flows for finance leases	$	(8,959)	$	(3,482)
Operating cash flows for finance leases	$	(3,354)	$	(718)
Operating cash flows for operating leases	$	(831)	$	(805)

Supplemental disclosure of noncash transactions
Finance right-of-use asset obtained in exchange for lease obligations	$	96,459	$	113,069
Finance lease liability arising from obtaining right-of-use assets	$	80,882	$	85,521


(in thousands)	Finance Lease Payments		Operating Lease Payments
Remainder of 2024	$	4,295	$	283
2025	17,203		1,141
2026	17,204		1,169
2027	17,204		1,198
2028	17,205		1,227
Thereafter	21,554		3,302
Total lease payments	94,665		8,320
Less: imputed interest	(13,783)		(1,351)
Total	$	80,882	$	6,969