Annual report [Section 13 and 15(d), not S-K Item 405]

LEASES

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LEASES
12 Months Ended
Dec. 31, 2024
Leases [Abstract]  
LEASES LEASES
Lease Commitments

At December 31, 2024, the Company was the lessee under eight operating leases and thirty-one finance leases. These leases contain rent holidays and customary escalations of lease payments for the types of facilities being leased. The Company's operating lease agreements include its corporate headquarters, dispensaries and cannabis production and processing facilities. The Company subleases three of these leased facilities to a cannabis-licensed client. The Company recognizes rent expense on a straight-line basis over the expected lease term, including option periods which the Company fully expects to exercise. Certain leases require the payment of property taxes, insurance and/or maintenance costs in addition to the rent payments.

The Company leases machinery and office equipment under finance leases that expire in January 2026 through July 2031, with such terms comprising a major part of the economic useful life of the leased property.

The components of lease expense for the years ended December 31, 2024 and 2023 were as follows (in thousands):

Year ended December 31,
2024 2023
Operating lease expense $ 2,069  $ 1,838 
Finance lease expense:
  Amortization of right-of-use assets $ 1,145  $ 606 
  Interest on lease liabilities 292  244 
    Total finance lease expense $ 1,437  $ 850 
The weighted average remaining lease terms and weighted average discount rates for the Company's operating leases and finance leases at December 31, 2024 and 2023 were as follows:

Year ended December 31,
2024 2023
Weighted average remaining lease term (years):
  Operating leases 9.26 9.83
  Finance leases 2.78 3.29
Weighted average discount rate:
  Operating leases 11.1  % 11.0  %
  Finance leases 9.6  % 11.0  %

Future minimum lease payments as of December 31, 2024 under all non-cancelable leases having an initial or remaining term of more than one year were as follows (in thousands):

Year ending December 31, Operating
leases
Finance
leases
2025 $ 1,988  $ 2,018 
2026 1,915  1,613 
2027 1,813  563 
2028 1,757  309 
2029 1,595  134 
  Thereafter 635  10 
Total lease payments 9,703  4,647 
Less: imputed interest (166) (703)
Present value of lease liabilities $ 9,537  $ 3,944 
LEASES LEASES
Lease Commitments

At December 31, 2024, the Company was the lessee under eight operating leases and thirty-one finance leases. These leases contain rent holidays and customary escalations of lease payments for the types of facilities being leased. The Company's operating lease agreements include its corporate headquarters, dispensaries and cannabis production and processing facilities. The Company subleases three of these leased facilities to a cannabis-licensed client. The Company recognizes rent expense on a straight-line basis over the expected lease term, including option periods which the Company fully expects to exercise. Certain leases require the payment of property taxes, insurance and/or maintenance costs in addition to the rent payments.

The Company leases machinery and office equipment under finance leases that expire in January 2026 through July 2031, with such terms comprising a major part of the economic useful life of the leased property.

The components of lease expense for the years ended December 31, 2024 and 2023 were as follows (in thousands):

Year ended December 31,
2024 2023
Operating lease expense $ 2,069  $ 1,838 
Finance lease expense:
  Amortization of right-of-use assets $ 1,145  $ 606 
  Interest on lease liabilities 292  244 
    Total finance lease expense $ 1,437  $ 850 
The weighted average remaining lease terms and weighted average discount rates for the Company's operating leases and finance leases at December 31, 2024 and 2023 were as follows:

Year ended December 31,
2024 2023
Weighted average remaining lease term (years):
  Operating leases 9.26 9.83
  Finance leases 2.78 3.29
Weighted average discount rate:
  Operating leases 11.1  % 11.0  %
  Finance leases 9.6  % 11.0  %

Future minimum lease payments as of December 31, 2024 under all non-cancelable leases having an initial or remaining term of more than one year were as follows (in thousands):

Year ending December 31, Operating
leases
Finance
leases
2025 $ 1,988  $ 2,018 
2026 1,915  1,613 
2027 1,813  563 
2028 1,757  309 
2029 1,595  134 
  Thereafter 635  10 
Total lease payments 9,703  4,647 
Less: imputed interest (166) (703)
Present value of lease liabilities $ 9,537  $ 3,944