Leases

3 Months Ended

Mar. 31, 2021

11. Leases

The Company leases certain warehouses, office space, machinery, vehicles, and equipment. Leases with an initial term of 12 months or less are not recorded on the balance sheet; the Company recognizes lease expense for these leases on a straight-line basis over the lease term.

The Company is not aware of any variable lease payments, residual value guarantees, covenants or restrictions imposed by the leases. Most leases include one or more options to renew, with renewal terms that can extend the lease term. The exercise of lease renewal options is at our sole discretion. The depreciable life of assets is limited by the expected lease term for finance leases.

If there was a rate explicit in the lease, this was the discount rate used. For those leases with no explicit or implicit interest rate, an incremental borrowing rate was used. The weighted average remaining useful life for operating and finance leases was 5 and 7 years, respectively. The weighted average discount rate for operating and finance leases was 5.2% and 12.5% respectively.

Leases (thousands)	Classification	March 31, 2021		December 31, 2020
Assets
Operating lease assets	Operating lease assets	$	3,752	$	4,068
Financing lease assets	Fixed assets, net		2,576		2,847
Total leased assets		$	6,328	$	6,915

Liabilities
Current
Operating	Current liabilities	$	1,009	$	1,167
Financing	Current liabilities		344		344

Non-current
Operating	Non-current liabilities		2,743		2,901
Financing	Non-current liabilities		4,128		4,221
Total lease liabilities		$	8,224	$	8,633

		Three months ended March 31,
Lease Cost (thousands)	Classification	2021		2020
Operating lease costs	Operating lease assets	$	304	$	262
Finance lease cost
Depreciation/amortization of leased assets	Depreciation		91		114
Interest on lease liabilities	Interest expense		141		151
Lease cost		$	536	$	527

	Three months ended March 31,
Other Information (thousands)	2021		2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	332	$	253
Operating cash flows from finance leases	$	76	$	113
Financing cash flows from finance leases	$	141	$	151

Future principal minimum lease payments period ending March 31 are:

	Operating Leases			Capital Leases
2022	$	1,176		$	872
2023		917			897
2024		683			925
2025		487			952
2026		392			981
And subsequent		713			2,675
Total undiscounted lease payments		4,368			7,302
Less interest		(616	)		(2,830	)
Total liabilities	$	3,752		$	4,472
Less current maturities		(1,009	)		(344	)
Non-current lease liabilities	$	2,743		$	4,128

Bridgeview Facility

Beginning on January 1, 2021, the Company leases its 40,000 sq. ft. Bridgeview facility from an unaffiliated third party. Until December 31, 2020 the property was owned by an entity controlled by Mr. David J. Langevin, the Company’s Executive Chairman.