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14. Leases
The Company has entered into multiple operating leases from which it conducts its business.
SINTX
With respect to SINTX operations, the Company leases 30,764 square feet of office, warehouse and manufacturing space under a single operating lease. This lease expires in October 2031. The lease has one five-year extension option.
SINTX Armor
On August 19, 2021, the Company, on behalf of SINTX Armor, entered into an Industrial Lease Agreement (the “SINTX Armor Lease”) pursuant to which the Company has agreed to lease approximately 10,936 square feet of office and manufacturing space from which SINTX Armor will conduct its operations. The term of the SINTX Armor Lease is 122 months through October 2031.
TA&T
In connection with operation of its business, TA&T has entered into various leases for approximately 15,840 square feet of office and manufacturing space from which it conducts its research, development and manufacturing activities. The leases have various expiration dates ranging from April 30, 2024 through April 2030. Subsequent to December 31, 2023 we entered into an amended lease agreement reducing this area to 13,560 square feet. The leases have various expiration dates ranging from July 2024 through April 2025.
Leases with an initial term of 12 months or less are not recorded on the balance sheet. Lease expense is recognized on a straight-line basis over the term of the lease. The Company accounts for lease components separately from the non-lease components. The depreciable life of the assets and leasehold improvements are limited by the expected lease term.
As of December 31, 2023, the operating lease right-of-use assets totaled approximately $4.1 million and the operating lease liability totaled approximately $4.2 million. Non-cash operating lease expense during the year ended December 31, 2023, totaled approximately $0.7 million. As of December 31, 2023, the weighted-average discount rate for the Company’s operating lease was 8.6%.
Operating lease future minimum payments together with the present values as of December 31, 2023, are summarized as follows:
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