LEASES

3 Months Ended

Mar. 31, 2024

We determine if our contractual agreements contain a lease at inception. A lease is identified when a contract allows us the right to control an identified asset for a period of time in exchange for consideration. Our lease agreements consist primarily of operating leases for office space, warehouses, office equipment, and trailers. We do not have material financing leases. Frequently, we enter into contractual relationships with a wide variety of transportation companies for freight capacity and utilize those relationships to efficiently and cost-effectively arrange the transport of our customers’ freight. These contracts typically have a term of twelve months or less and do not allow us to direct the use or obtain substantially all of the economic benefits of a specifically identified asset. Accordingly, these agreements are not considered leases.

Our operating leases are included on the consolidated balance sheets as right-of-use lease assets and lease liabilities. A right-of-use lease asset represents our right to use an underlying asset over the term of a lease, while a lease liability represents our obligation to make lease payments arising from the lease. Current and noncurrent lease liabilities are recognized on the commencement date at the present value of lease payments, including non-lease components, which consist primarily of common area maintenance and parking charges. Right-of-use lease assets are also recognized on commencement date as the total lease liability plus prepaid rents. As our leases typically do not provide an implicit rate, we use our fully collateralized incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The incremental borrowing rate is influenced by market interest rates, our credit rating, and lease term and as such, may differ for individual leases.

Our lease agreements typically do not contain variable lease payments, residual value guarantees, purchase options, or restrictive covenants. Many of our leases include the option to renew for a period of months to several years. The term of our leases may include the option to renew when it is reasonably certain we will exercise that option, although these occurrences are seldom. We have lease agreements with lease components (e.g., payments for rent) and non-lease components (e.g., payments for common area maintenance and parking), which are all accounted for as a single lease component.

We do not have material lease agreements that have not yet commenced that are expected to create significant rights or obligations as of March 31, 2024.

Information regarding lease expense, remaining lease term, discount rate, and other select lease information are presented below (dollars in thousands):


	Three Months Ended March 31,
Lease Costs	2024		2023
Operating lease expense	$	25,637	$	24,653
Short-term lease expense	1,162		1,414
Total lease expense	$	26,799	$	26,067


	Three Months Ended March 31,
Other Lease Information	2024		2023
Operating cash flows from operating leases	$	25,223	$	24,815
Right-of-use lease assets obtained in exchange for new lease liabilities	36,810		6,739


Lease Term and Discount Rate	As of March 31, 2024		As of December 31, 2023
Weighted average remaining lease term (in years)	5.8		5.9
Weighted average discount rate	4.0	%	3.9	%

The maturities of lease liabilities as of March 31, 2024, were as follows (in thousands):


Maturity of Lease Liabilities	Operating Leases
Remaining 2024	$	66,869
2025	87,850
2026	74,356
2027	58,237
2028	43,249
Thereafter	102,221
Total lease payments	432,782
Less: Interest	(47,679)
Present value of lease liabilities	$	385,103