Quarterly report pursuant to Section 13 or 15(d)

Commitments and Contingencies

v3.23.3
Commitments and Contingencies
 9 Months Ended
Sep. 30, 2023
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies Commitments and Contingencies
Leases
During the three and nine months ended September 30, 2023, the Company maintained six leases of facilities located in the United States and the Netherlands, as well as two leases of equipment classified as finance leases. In addition, the Company has two failed sale-leaseback transactions that have been recorded as finance obligations within its unaudited condensed consolidated balance sheets. See Note 13 for additional information.
The table below presents certain information related to the Company’s lease costs:
Three Months Ended
September 30,		 Nine Months Ended
September 30,
2023 2022 2023 2022
Operating lease expense $ 249  $ 302  $ 749  $ 687 
Finance lease expense 12  —  31  — 
Interest expense on finance lease liabilities 5  —  14  — 
Total lease cost $ 266  $ 302  $ 794  $ 687 
The Company recorded sublease income of $62 and $108 during the three months ended September 30, 2023 and 2022, respectively and $221 and $142 during the nine months ended September 30, 2023 and 2022, respectively. The sublease income is associated with the Company's sublease of its facility in Michigan.
Right-of-use assets and lease liabilities for operating leases were recorded in the unaudited condensed consolidated balance sheets as follows:
September 30,
2023		 December 31,
2022
Assets:
Operating lease right-of-use assets, net $ 1,948  $ 2,365 
Finance lease right-of-use assets, net 323  — 
Total lease assets $ 2,271  $ 2,365 
Liabilities:
Current liabilities:
Operating lease liabilities, current $ 872  $ 719 
Finance lease liability, current 62  — 
Non-current liabilities:
Operating lease liabilities, net of current portion 1,176  1,715 
Finance lease liability, net of current portion 261  — 
Total lease liabilities
 $ 2,371  $ 2,434 
The Company’s lease agreements do not state an implicit borrowing rate, therefore, an internal incremental borrowing rate was determined based on information available at the lease commencement date for the purposes of determining the present value of lease payments. The incremental borrowing rate reflects the cost to borrow on a securitized basis in each market. The weighted-average remaining lease term for operating and finance leases was 2.33 years and 4.49 years, respectively and the weighted-average incremental borrowing rate for operating and finance leases was 6.93% and 8.24%, respectively, as of September 30, 2023.
Supplemental cash flow information related to the Company’s leases was as follows:
Nine Months Ended
September 30,
2023 2022
Operating cash flows from operating leases $ 721  $ 732 
Financing cash flows from finance leases $ 45  $ — 
Lease liabilities arising from obtaining right-of-use assets $ 595  $ — 
As of September 30, 2023, future minimum lease payments required under operating and finance leases are as follows:
Operating Leases Finance Leases
Rest of 2023
 $ 242  $ 22 
2024 965  87 
2025 791  87 
2026 236  87 
2027 —  87 
Thereafter —  18 
Total minimum lease payments 2,234  388 
Less effects of discounting (186) (65)
Present value of future minimum lease payments $ 2,048  $ 323 
Desktop Metal
As of September 30, 2023, the Company had paid $16.4 million to Desktop Metal for equipment, materials and services received and placed purchase orders for another $3.6 million of equipment, materials and services to be purchased under the MOU. The timing of payments for these purchase orders may depend on a number of factors, including Desktop Metal's inventory management and logistics systems and the Company's ability to take delivery of any such equipment, materials and services. The Company has no further obligations under the MOU.
Legal Proceedings
The Company is involved in various legal proceedings which arise from time to time in the normal course of business. While the results of such matters generally cannot be predicted with certainty, management does not expect any such matters to have a material adverse effect on the Company’s unaudited condensed consolidated financial position or results of operations as of September 30, 2023 and December 31, 2022 and for the three and nine months ended September 30, 2023 and 2022, respectively.