Leases

3 Months Ended

Mar. 31, 2022

Leases [Abstract]

Leases

Leases

Rockwell leases its production facilities and administrative offices as well as certain equipment used in its operations including leases on transportation equipment used in the delivery of its products. The lease terms range from monthly to seven years. Rockwell occupies a 51,000 square foot facility and a 17,500 square foot facility in Wixom, Michigan under a lease expiring in August 2024. Rockwell also occupies two other manufacturing facilities, a 51,000 square foot facility in Grapevine, Texas under a lease expiring in December 2025, and a 57,000 square foot facility in Greer, South Carolina under a lease expiring February 2023. In addition, Rockwell occupies 4,100 square feet of office space in Hackensack, New Jersey under a lease expiring on October 31, 2024. This lease was subleased on December 15, 2021 with an expiration date of October 31, 2024.

At March 31, 2022, the Company had operating and finance lease liabilities of $7.4 million and right-of-use assets of $7.2 million, which are included in the consolidated balance sheet.

At December 31, 2021, the Company had operating lease liabilities of $7.9 million and right-of-use assets of $7.7 million, which are included in the consolidated balance sheet.

The following summarizes quantitative information about the Company’s operating leases (table in thousands):

	Three Months Ended March 31, 2022			Three Months Ended March 31, 2021
Operating leases
Operating lease cost	$	449		$	419
Variable lease cost	95			102
Operating lease expense	544			521
Finance leases
Amortization of right-of-use assets	141			45
Interest on lease obligations	47			13
Finance lease expense	188			58
Short-term lease rent expense	4			4
Total rent expense	$	736		$	583
Other information
Operating cash flows from operating leases	$	464		$	425
Operating cash flows from finance leases	$	47		$	13
Financing cash flows from finance leases	$	118		$	37
Right of use assets exchanged for operating lease liabilities	$	—		$	1,896
Right of use assets exchanged for finance lease liabilities	$	—		$	460
Weighted-average remaining lease term – operating leases	3.4			3.6
Weighted-average remaining lease term – finance leases	5.2			5.4
Weighted-average discount rate – operating leases	6.3		%	6.3		%
Weighted-average discount rate – finance leases	6.4		%	5.4		%

Future minimum rental payments under operating lease agreements are as follows (in thousands):

	Operating		Finance
Year ending December 31, 2022 (remaining)	$	1,307	$	495
Year ending December 31, 2023	1,456		669
Year ending December 31, 2024	1,114		672
Year ending December 31, 2025	637		676
Year ending December 31, 2026	260		666
Remaining future payments	121		311
Total	$	4,895	$	3,489
Less present value discount	(485)		(516)
Operating and finance lease liabilities	$	4,410	$	2,973

Leases

Leases

Rockwell leases its production facilities and administrative offices as well as certain equipment used in its operations including leases on transportation equipment used in the delivery of its products. The lease terms range from monthly to seven years. Rockwell occupies a 51,000 square foot facility and a 17,500 square foot facility in Wixom, Michigan under a lease expiring in August 2024. Rockwell also occupies two other manufacturing facilities, a 51,000 square foot facility in Grapevine, Texas under a lease expiring in December 2025, and a 57,000 square foot facility in Greer, South Carolina under a lease expiring February 2023. In addition, Rockwell occupies 4,100 square feet of office space in Hackensack, New Jersey under a lease expiring on October 31, 2024. This lease was subleased on December 15, 2021 with an expiration date of October 31, 2024.

At March 31, 2022, the Company had operating and finance lease liabilities of $7.4 million and right-of-use assets of $7.2 million, which are included in the consolidated balance sheet.

At December 31, 2021, the Company had operating lease liabilities of $7.9 million and right-of-use assets of $7.7 million, which are included in the consolidated balance sheet.

The following summarizes quantitative information about the Company’s operating leases (table in thousands):

	Three Months Ended March 31, 2022			Three Months Ended March 31, 2021
Operating leases
Operating lease cost	$	449		$	419
Variable lease cost	95			102
Operating lease expense	544			521
Finance leases
Amortization of right-of-use assets	141			45
Interest on lease obligations	47			13
Finance lease expense	188			58
Short-term lease rent expense	4			4
Total rent expense	$	736		$	583
Other information
Operating cash flows from operating leases	$	464		$	425
Operating cash flows from finance leases	$	47		$	13
Financing cash flows from finance leases	$	118		$	37
Right of use assets exchanged for operating lease liabilities	$	—		$	1,896
Right of use assets exchanged for finance lease liabilities	$	—		$	460
Weighted-average remaining lease term – operating leases	3.4			3.6
Weighted-average remaining lease term – finance leases	5.2			5.4
Weighted-average discount rate – operating leases	6.3		%	6.3		%
Weighted-average discount rate – finance leases	6.4		%	5.4		%

Future minimum rental payments under operating lease agreements are as follows (in thousands):

	Operating		Finance
Year ending December 31, 2022 (remaining)	$	1,307	$	495
Year ending December 31, 2023	1,456		669
Year ending December 31, 2024	1,114		672
Year ending December 31, 2025	637		676
Year ending December 31, 2026	260		666
Remaining future payments	121		311
Total	$	4,895	$	3,489
Less present value discount	(485)		(516)
Operating and finance lease liabilities	$	4,410	$	2,973