Leases

12 Months Ended

Dec. 31, 2019

As lessor, and as of December 31, 2019, all of our leases were operating leases with the exception of two leases entered into during the first quarter of 2019 which are classified as notes receivable under the failed sale leaseback guidance provided by ASC 842.

As lessee, the significant majority of leases the Company enters are for real estate (office and warehouse space for our operations as well as automobiles). These lease agreements do not contain any material residual value guarantees or material restrictive covenants. As of January 1, 2019, the Company did not have any significant leases that had not yet commenced but that created significant rights and obligations. Leases with terms of 12 months or less are not recorded on the balance sheet; the Company recognizes lease expense for these leases on a straight-line basis over the lease term. Some of the Company's leases include variable non-lease components (e.g., taxes) which are not separated from associated lease components (e.g. fixed rent, common-area maintenance costs, vehicle protection plans and other service fees) as elected under the practical expedient package provided by ASC 842.

The Company's leases have remaining lease terms of one to seven years, some of which include options to renew or extend the lease term from one to five years. Our automobile leases include an option to purchase the vehicle at lease termination. The depreciable life of assets is limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise. The exercise of lease renewal options or purchase at lease termination is at the Company's sole discretion. If it is reasonably certain that we will exercise such options, the periods covered by such options are included in the lease term and are recognized as part of our ROU assets and lease liabilities.

Supplemental balance sheet information related to leases was as follows:



Leases	Classification	December 31, 2019
		(in thousands, except lease term and discount rate)
Assets
Operating lease right-of-use assets	Other assets	$	4,084
Total leased assets		$	4,084

Liabilities
Operating lease right-of-use liabilities	Accounts payable and accrued expenses	$	3,835
Total lease liabilities		$	3,835

Weighted average remaining lease term (years)
Operating leases		5.17
Weighted average discount rate
Operating leases		4.5		%

The weighted average discount rate is based on the discount rate for each lease and the remaining balance of the lease payments for each lease at the reporting date.

Future maturities of the Company's operating lease liabilities at December 31, 2019 are as follows:



Year	(in thousands)
2020	$	947
2021	895
2022	762
2023	504
2024	358
Thereafter	896
Total lease payments	4,362
Less: interest	(527		)
Total lease liabilities	$	3,835

The following table represents future minimum lease payments under noncancelable operating leases at December 31, 2019:



Year	(in thousands)
2020	$	922
2021	878
2022	762
2023	504
2024	358
Thereafter	896
	$	4,320

The following table represents future minimum lease payments under noncancelable operating leases at December 31, 2018 as presented in the Company's 2018 Form 10-K:



Year	(in thousands)
2019	$	1,172
2020	676
2021	638
2022	645
2023	483
Thereafter	1,183
	$	4,797

The components of lease expense for the years ended December 31, 2019 and 2018 were as follows:



Lease expense	Classification	2019		2018
		(in thousands)
Operating lease cost	General and administrative	$	1,326	$	1,688
Net lease cost		$	1,326	$	1,688

Supplemental cash flow information related to leases for the year ended December 31, 2019 was as follows:



	(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	920

Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	495