LEASES

3 Months Ended

Mar. 31, 2021

The Company leases real properties for use in manufacturing and as administrative and sales offices, and leases automobiles and office equipment. The Company determines if a contract contains a lease arrangement at the inception of the contract. For leases in which the Company is the lessee, leases are classified as either finance or operating. Right of use (ROU) assets are initially measured at the present value of lease payments over the lease term plus initial direct costs, if any, with the classification affecting the pattern of expense recognition. If a lease does not provide a discount rate and the rate cannot be readily determined, an incremental borrowing rate is used to determine the future lease payments. Lease and non-lease components within the Company’s lease agreements are accounted for together.

Nearly all of the Company’s leasing arrangements are classified as operating leases. ROU asset and lease liability balances were as follows for the periods presented:


	March 31, 2021		December 31, 2020
ROU asset	10,589		10,733

Current lease liability	1,505		1,741
Long-term lease liability	10,137		10,066
Total lease liability	$	11,642	$	11,807

The ROU asset was included in “Other assets” while the current lease liability was reported in “Other current liabilities” and the long-term lease liability was reported in “Other long-term liabilities” on the Company’s Condensed Consolidated Balance Sheet. Cash paid for operating lease liabilities are recorded as cash flows from operating activities in the Company’s Condensed Consolidated Statements of Cash Flows. For the three months ended March 31, 2021 and 2020, operating lease costs were $971 and $1,102, respectively, which were included in the Company’s Condensed Consolidated Statements of Operations. Short term and variable lease costs were not material for the three months ended March 31, 2021 and 2020.

Certain of the Company’s leases contain renewal options and options to extend the leases for up to five years, and a majority of these options are reflected in the calculation of the ROU asset and lease liability due to the likelihood of renewal.

The following table summarizes the weighted average lease terms and discount rates for operating lease liabilities:


	March 31, 2021
Weighted average remaining lease term (in years)	8.03
Weighted average discount rate	5.1	%

The following table represents maturities of operating lease liabilities as of March 31, 2021:


Due within 1 year	$	1,505
Due after 1 year through 2 years	2,077
Due after 2 years through 3 years	1,967
Due after 3 years through 4 years	1,792
Due after 4 years through 5 years	1,733
Due after 5 years	5,727
Total future minimum lease payments	14,801
Less imputed interest	(3,159)
Total	$	11,642