14. LEASES

The Company's operating leases consist of rent commitments under various leases for office space, warehouses, land and buildings at varying dates from January 2019 to June 2028. The terms of most of these leases are in the range of 3 to 10 years. Some the Company's lease obligations have rent escalations, rent holidays or contingent rent that are recognized on a straight-line basis over the entire lease term. Material leasehold improvements and other landlord incentives are amortized over the shorter of their economic lives or the lease term, including renewal periods, if reasonably assured. Certain annual rentals are subject to renegotiation, with certain leases renewable for varying periods. The terms for most machinery and equipment leases range from 3 to 5 years. Substantially all real estate taxes, insurance and maintenance expenses associated with leased facilities are obligations of the Company. It is expected that in the normal course of business leases that expire will be renewed or replaced by leases on other similar property.

The majority of the Company's finance leases consist of assets purchased under the Company's master leasing agreement with PNC, including machinery, office furniture and equipment and construction in process. At March 29, 2019, the Company's master leasing agreement with PNC had a total capacity to $20.0 million. The terms of these leases are 5 years. Amortization of these assets is included in depreciation and amortization expense. At March 29, 2019, $8.2 million of assets included in property, plant and equipment, net of accumulated depreciation, were accounted for as finance leases, with the majority of these assets being purchased under the Company's master leasing agreement with PNC. At March 29, 2019, the Company had accumulated depreciation of $1.8 million associated with these assets. Additionally, $3.3 million of assets purchased under the Company's master leasing agreement were included in construction in process in property, plant and equipment, net of accumulated depreciation. At December 31, 2018, $11.4 million of assets purchased under the Company's master leasing agreement and accounted for as capital leases were included in property, plant and equipment, net of accumulated depreciation, with accumulated depreciation of $1.5 million.

At the commencement date of a contract containing a lease, a right-of-use asset and lease liability are recorded to the Company's Condensed Balance Sheets when the Company obtains control of the use of the asset. Right-of-use assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make payments upon entering into a lease agreement.

Right-of-use assets, net consists of the following:



	Classification	March 29, 2019⁽¹⁾
In thousands
Assets
Operating lease right of use assets	Operating lease right-of-use assets, net	$	87,825
Finance lease right of use assets	Property, plant and equipment, net of accumulated depreciation	6,413
Total leased assets		$	94,238

⁽¹⁾ The Company elected the modified retrospective transition method that applies ASC 842 as of January 1, 2019. Refer to Note 3, Significant Accounting Policies Update, for further information on the adoption of ASC 842.

14. LEASES (CONTINUED)

The lease liability and future rental payments are required under leases that have initial or remaining non-cancellable lease terms in excess of one year as of March 29, 2019. Lease liabilities consist of the following:



	Classification	March 29, 2019		December 31, 2018
In thousands
Liabilities
Current
Operating lease liability, current portion	Operating lease liabilities, current portion	$	24,345	$	—
Finance lease liability, current portion	Other current liabilities	2,103		1,989
Noncurrent
Operating lease liability, noncurrent portion	Operating lease liabilities, noncurrent portion	64,643		—
Finance lease liability, noncurrent portion	Other long-term liabilities	6,624		6,579
Total lease liabilities		$	97,715	$	8,568

Future rental payments consist of the following:



	March 29, 2019
In thousands

Operating leases
2019⁽¹⁾	$	21,123
2020	24,633
2021	19,715
2022	13,457
2023	8,860
Thereafter	10,493
Total future operating lease payments	$	98,281
Interest	(9,293		)
Present value of future operating lease payments	$	88,988

Finance leases
2019⁽¹⁾	$	1,750
2020	2,250
2021	2,070
2022	1,685
2023	1,165
Thereafter	222
Total future finance lease payments	$	9,142
Interest	(415		)
Present value of future finance lease payments	$	8,727

Present value of total future lease payments	$	97,715

⁽¹⁾ Payments for 2019 include payments for the remaining nine months of the year ended December 31, 2019.

14. LEASES (CONTINUED)

Prior to the adoption of ASC 842, operating lease payments on an undiscounted basis were approximately $101.8 million and were payable as follows: $27.5 million in 2019, $23.6 million in 2020, $18.8 million in 2021, $12.8 million in 2022, $8.7 million in 2023 and $10.4 million thereafter. Prior to the adoption of ASC 842, finance lease payments (capital lease payments under ASC 840) on an undiscounted basis were approximately $8.6 million and were payable as follows: $2.0 million in 2019, $2.0 million in 2020, $1.8 million in 2021, $1.5 million in 2022, $1.0 million in 2023 and $0.2 million thereafter.

The following table illustrates the components of lease expense for the Company's leases.



	March 29, 2019
In thousands
Finance lease cost
Amortization of right-of-use assets	$	230
Interest on lease liabilities	49
Operating lease cost	7,219
Short-term lease cost	25
Variable lease cost	19
Total lease expense	$	7,542

The following table segregates cash paid for the Company's leases.



	March 29, 2019
In thousands
Operating cash flows from operating leases	$	(5,027	)
Operating cash flows from finance leases	(49		)
Financing cash flows from finance leases	(372		)
Total cash flows from leasing activities	$	(5,448	)

During the three-month fiscal period ended March 29, 2019, $2.8 million in right-of-use assets were obtained in exchange for new operating lease liabilities. Right-of-use assets obtained in exchange for new finance lease liabilities were not material.

Other information related to leases is as follows:



	March 29, 2019

Weighted-average remaining lease term
Operating leases	4.49
Finance leases	3.68
Weighted-average discount rate
Operating leases	4.33	%
Finance leases	3.96	%