The Company has operating leases for facilities and finance leases for office equipment. Leases with an initial term of 12 months or less are not recorded in the balance sheet. The Company determines if an arrangement is a lease at inception of a contract.

Right of Use (“ROU”) assets represent the Company's right to use an underlying asset during the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the lease commencement date based on the net present value of fixed lease payments over the lease term. The Company's lease term is deemed to include options to extend or terminate the lease when it is reasonably certain that it will exercise that option. ROU assets also include any advance lease payments made and exclude lease incentives. As most of the Company's operating leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments on a collateralized basis. Finance lease agreements generally include an interest rate that is used to determine the present value of future lease payments. Operating fixed lease expense and finance lease depreciation expense are recognized on a straight-line basis over the lease term.

The Company's lease cost for the three and six months ended June 30, 2021 and 2020, respectively, included the following components:

	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Operating lease costs	$	115	$	165	$	212	$	410
Short-term lease costs		41		14		82		27
Variable lease costs		2		0		4		2
Amortization of finance lease assets		21		21		35		41
Interest on finance lease liabilities		2		2		4		4
Total lease cost	$	181	$	202	$	337	$	484

The table below summarizes the Company's scheduled future minimum lease payments under operating and finance leases recorded on the balance sheet as of June 30, 2021:

Year	Operating Leases			Finance Leases
2021	$	286		$	42
2022		658			67
2023		611			44
2024		581			33
2025		501			15
Thereafter		2,675			4
Total minimum payments required		5,312			205
Less: amount representing interest		1,052			13
Present value of net minimum lease payments		4,260			192
Less: current maturities of lease obligations		(450	)		(75	)
Long-term lease obligations	$	3,810		$	117

The weighted average remaining lease terms and discount rates for all the Company’s operating and finance leases were as follows as of June 30, 2021:

The table below presents supplemental cash flow information related to leases during the three and six months ended June 30, 2021 and 2020, respectively:

	Three Months Ended June 30,					Six Months Ended June 30,
	2021		2020			2021		2020
Cash paid for (received) amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases	$	153	$	143		$	253	$	229
Operating cash flows from tenant improvement incentives from operating leases	$	0	$	(27	)	$	0	$	(1,004	)
Operating cash flows for finance leases	$	2	$	2		$	4	$	4
Financing cash flows for finance leases	$	19	$	21		$	35	$	41

The following table summarizes the classification of ROU assets and lease liabilities as of June 30, 2021 and December 31, 2020:

Leases	Consolidated Balance Sheet Classification	June 30, 2021		December 31, 2020
Assets:
Operating right-of-use assets	Other noncurrent assets	$	2,381	$	2,272
Finance right-of-use assets	Other noncurrent assets		186		157
Total leased assets		$	2,567	$	2,429
Liabilities:
Current
Operating lease liabilities	Accrued liabilities	$	450	$	269
Finance lease liabilities	Accrued liabilities		75		68
Noncurrent
Operating lease liabilities	Long-term liabilities		3,810		3,949
Finance lease liabilities	Long-term liabilities		117		96
Total lease liabilities		$	4,452	$	4,382

On March 5, 2020, PCTEL (Tianjin) Wireless Telecommunications Products, Co. Ltd., a wholly owned subsidiary of the Company (“PCTEL Tianjin”), entered into a letter agreement with Wang Zhuang Village Committee of Tianjin, China (the “Letter Agreement”) specifying the terms for extension of the lease of the premises on which PCTEL Tianjin currently conducts its manufacturing activities in Tianjin, China (the “Tianjin Lease”) to October 2022. The Letter Agreement did not, however, effect the lease extension. The Tianjin Lease expired on October 8, 2020 without extension. On October 16, 2020, the Wang Zhuang Village Committee issued a notice informing PCTEL Tianjin that the Chinese Party Central Committee and the State Council are accelerating the layout optimization and transformation of the industrial park in which the leased premises is located, and accordingly leases and lease extensions for all premises in the industrial park have been suspended and rent collection has been postponed. The letter indicates that if the Tianjin Lease extension is subsequently approved, the rent for the period from October 9, 2020 to the date of the Tianjin Lease extension (the “Intervening Period”) will then be due and payable. In July 2021, PCTEL Tianjin received an indication from local Chinese authorities that the Tianjin lease extension is likely to be approved for a period of October 10, 2020 to December 31, 2021 and lease negotiations have commenced. However, based upon past practices and verbal assurances, the Company believes that PCTEL Tianjin will have not less than 30 days to vacate the leased premises if the Lease Extension is not approved.

As part of the acquisition of Smarteq on April 30, 2021, the Company assumed an office lease and an automotive lease. The office in Kista, Sweden has 4,080 square feet used for engineering, sales, and administration with a lease term ending July 31, 2023. On the acquisition date, the Company recorded $0.2 million for each of the right-of-use assets and the lease liabilities.