Leases

6 Months Ended

Jun. 30, 2023

Leases [Abstract]

Leases

4. Leases

The Company rents certain office facilities and equipment under noncancelable operating leases. As of June 30, 2023, approximately 96,000 square feet of office space is utilized for our sales and recruiting offices, delivery centers, and corporate headquarters. All our leases are classified as operating leases. The average initial lease term is 4.9 years. Several leases have an option to renew, at our sole discretion, for an additional term. Our present lease terms range from less than one year to 3.8 years, with a weighted average of 3.0 years. Leases with an initial term of 12 months or less are not recorded on the balance sheet.

The following table summarizes the balance sheet classification of the lease assets and related lease liabilities:

	June 30, 2023		December 31, 2022
	(in thousands)
Assets:
Long-term operating lease right-of-use assets	$	3,118	$	3,886
Liabilities:
Short-term operating lease liability	$	1,228	$	1,504
Long-term operating lease liability		1,851		2,294
Total Liabilities	$	3,079	$	3,798

Future minimum rental payments for office facilities and equipment under the Company’s noncancelable operating leases are as follows:

	Amount as of June 30, 2023
	(in thousands)
2023 (for remainder of year)	$	815
2024		949
2025		682
2026		666
2027		158
Thereafter		—
Total	$	3,270
Less: Imputed interest		(191	)
Present value of operating lease liabilities	$	3,079

The weighted average discount rate used to calculate the present value of future lease payments was 3.7%.

We recognize rent expense for these leases on a straight-line basis over the lease term. Rental expense for the three and six months ended June 30, 2023, totaled $0.4 million and $0.8 million, respectively. Rental expense for the three and six months ended June 30, 2022, totaled $0.5 million and $0.9 million, respectively.

Total cash paid for lease liabilities for the three and six months ended June 30, 2023, totaled $0.4 million and $0.8 million, respectively. Total cash paid for lease liabilities for the three and six months ended June 30, 2022, totaled $0.5 million and $0.9 million, respectively.

New leases entered into during the three and six months ended June 30, 2023, totaled zero dollars. New leases entered into during the three and six months ended June 30, 2022, totaled zero dollars and $0.5 million, respectively. New leases are considered non-cash transactions.