Leases

3 Months Ended

Mar. 31, 2019

14. Leases

The Company has operating and finance leases for real estate and equipment. Generally, the leases have remaining terms of one month to ten years. Leases with an initial term of 12 months or less which do not include an option to purchase the underlying asset that the Company is reasonably certain to exercise are not recorded on the balance sheet. The Company recognizes lease expense for these leases on a straight-line basis over the lease term.

In addition, some leases include options to terminate the lease. The Company generally negotiates these termination clauses in anticipation of any changes in market conditions; however, because a termination option requires approval from management, the Company assumes the majority of its termination options will not be exercised when determining the lease term.

The Company has elected the practical expedient to not separate non-lease components from the lease components to which they relate, and instead account for each separate lease and non-lease component associated with that lease component as a single lease component for all underlying asset classes. Accordingly, all costs associated with a lease contract are accounted for as lease cost. Lease expense is recorded in operating expenses in the results of operations.

Some leasing arrangements require variable payments that are dependent on usage, output, or may vary for other reasons, such as insurance and tax payments. The variable portion of lease payments is not included in the computation of the right of use assets or lease liabilities. Rather, variable payments, other than those dependent upon a market index or rate, are expensed when the obligation for those payments is incurred and are included in lease expense in the results of operations.

The Company does not include significant restrictions or covenants in our lease agreements, and residual value guarantees are generally not included within our operating leases.

The components of lease cost were as follows:



	Three months ended March 31, 2019
Operating lease cost	$	33
Short-term lease expense	1
Variable lease cost	8
Total lease cost	$	42

Other information related to leases was as follows:



	Three months ended March 31, 2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	41

Supplemental balance sheet information related to leases was as follows:



	March 31, 2019
Operating leases
Operating lease right-of-use assets ^(a)	$	362

Other current liabilities ^(b)	$	101
Other long-term liabilities ^(c)	256
Total operating lease liabilities	$	357

Finance leases
Property, plant and equipment, gross	$	2
Accumulated depreciation	—
Total finance lease right-of-use assets	$	2

Other current liabilities ^(b)	$	1
Other long-term liabilities ^(c)	1
Total finance lease liabilities	$	2

(a) Included in "Other assets" in the condensed consolidated balance sheets.
(b) Included in "Accrued expenses and other current liabilities" in the condensed consolidated balance sheets.
(c) Included in "Deferred credits and other liabilities" in the condensed consolidated balance sheets.



	March 31, 2019
	Weighted average remaining lease term	Weighted average discount rate
Operating leases	5.29 years	4.26	%
Finance leases	3.23 years	4.85	%

Maturities of lease liabilities under non-cancellable leases as of March 31, 2019 were as follows:



Year ending December 31	Operating leases			Finance leases
2019 (excluding the three months ended March 31, 2019)	$	85		$	1
2020	91			1
2021	69			—
2022	48			—
2023	34			—
Thereafter	55			—
Total future undiscounted lease payments	382			2
Less imputed interest	(25		)	—
Total reported lease liability	$	357		$	2

Future minimum operating lease payments at December 31, 2018 are as follows:



2019	$	120
2020	100
2021	86
2022	68
2023	56
Beyond 2023	53
	$	483

Leases