Leases

12 Months Ended

Dec. 31, 2020

Leases [Abstract]

Lessee, Operating Leases [Text Block]

7. Leases

Lessee

The Company has various cancelable and noncancelable leased assets within all segments, which include certain properties, vehicles and equipment of which are all classified as operating leases. Payments for these leases are generally fixed; however, several of our leases are composed of variable lease payments including index-based payments or inflation-based payments based on a Consumer Price Index (“CPI”) or other escalators. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

Under Leases (Topic 842), the Company determines an arrangement is a lease when we have the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. Other than the leases that we have already identified, we are not aware of any material leases that have not yet commenced. For leases that have a calculated lease term of 12 months or less and do not include an option to purchase the underlying asset which we are reasonably certain to exercise, the Company has made the policy election to not apply the recognition requirements in Leases (Topic 842). For these short-term leases, the Company recognizes the lease payments in profit or loss on a straight-line basis over the lease term and variable lease payments in the period in which the obligation for those payments is incurred.

For the leases identified, right of use (“ROU”) assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, the Company used the calculated incremental borrowing rate based on the information available at the implementation date, and going forward at the commencement date, in determining the present value of lease payments. The Company will use the implicit rate when readily determinable. The ROU asset includes the carrying amount of the lease liability, plus (minus) any prepaid (accrued) lease payments, less the unamortized balance of lease incentives received. The Company’s lease terms may include options to extend or terminate the lease and such options are included in the lease term when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Lease expenses are recognized within COGS, SG&A and design and development (“D&D”) costs in the consolidated statements of operations. The Company has made the policy election to account for lease and non-lease components as a single lease component for all of its leases.

As a result of the Company’s election to apply the modified retrospective transition method at the effective date of the standard, information prior to January 1, 2019 has not been restated and continues to be reported under the accounting standards in effect for the period (ASC Topic 840).

The components of lease expense are as follows:

Year ended December 31		2020		2019
Operating lease cost	$	5,330	$	5,740
Short-term lease cost		665		529
Variable lease cost		614		363
Total lease cost	$	6,609	$	6,632

Balance sheet information related to leases is as follows:

As of December 31		2020		2019
Assets:
Operating lease right-of-use assets	$	18,944	$	22,027
Liabilities:
Operating lease current liability, included in other current liabilities	$	4,271	$	4,556
Operating lease long-term liability		15,434		17,971
Total leased liabilities	$	19,705	$	22,527

Maturities of operating lease liabilities are as follows:

As of December 31		2020
2021	$	4,873
2022		3,862
2023		3,627
2024		3,208
2025		2,444
Thereafter		5,707
Total future minimum lease payments	$	23,721
Less: imputed interest		(4,016)
Total lease liabilities	$	19,705

Weighted-average remaining lease term and discount rate for operating leases is as follows:

As of December 31	2020		2019
Weighted-average remaining lease term (in years)	6.33		6.71
Weighted-average discount rate	5.77	%	5.75	%

Other information:

Year ended December 31		2020		2019
Operating cash flows:
Cash paid related to operating lease obligations	$	5,550	$	5,558
Non-cash activity:
Right-of-use assets obtained in exchange for
operating lease obligations	$	822	$	6,065

Lessor

The Company, as lessor, has entered into a lease with a third-party lessee effective July 1, 2020, of its Canton, Massachusetts facility. In conjunction with the Canton restructuring plan outlined in Note 13, the Company ceased operations at this facility in March 2020. The Company recognizes lease income on a straight-line basis over the lease term, and the leased asset is included in property, plant and equipment, net in the consolidated balance sheet and depreciated to its estimated residual value over the remaining useful life of the assets. The carrying value of the leased facility is comprised of land of $1,225 and building and building improvements of $9,635, with accumulated depreciation of $7,637 as of December 31, 2020. The lease includes two optional extension terms of five years each. The Company recognized, in its Control Devices segment, operating and variable lease income from leases in our consolidated statements of operations of $674 and $199, respectively for the year ended December 31, 2020.

Maturities of future minimum lease payments to be received are as follows:

As of December 31		2020
2021	$	1,544
2022		1,582
2023		1,622
2024		1,662
2025		1,704
Thereafter		3,083
Total future minimum lease payments to be received	$	11,197