Leases

12 Months Ended

Dec. 31, 2021

Leases [Abstract]

Leases

LEASES

The Company has operating and finance leases for corporate and sales offices, and certain vehicles and equipment accounted for under ASC 842. The leases have remaining lease terms of one year to five years, some of which include options to extend for up to five years, and some of which include options to terminate the leases within one year. However, the Company in general is not reasonably certain to exercise options to renew or terminate, and therefore renewal and termination options are not considered in the lease term or the ROU asset and lease liability balances. The Company’s lease population includes purchase options on equipment leases that are included in the lease payments when reasonably certain to be exercised. The Company’s lease population does not include any residual value guarantees. The Company’s lease population does not contain any material restrictive covenants.

The Company has leases with variable payments, most commonly in the form of Common Area Maintenance (“CAM”) and tax charges which are based on actual costs incurred. These variable payments were excluded from the ROU asset and lease liability balances since they are not fixed or in-substance fixed payments. Variable payments are expensed as incurred.

The components of lease expense were as follows:

	Year Ended December 31,
	2021		2020		2019
Operating lease cost	$	4,578	$	4,572	$	4,636
Short-term lease cost	374		349		338
Variable lease cost	320		634		623
Finance lease cost:
Amortization	58		111		224
Interest on lease liabilities	9		14		15
Total lease cost	$	5,339	$	5,680	$	5,836

Supplemental cash flow information related to leases was as follows:

	Year Ended December 31,
	2021		2020		2019
Cash paid for amounts included in measurement of lease liabilities:
Operating cash flows from operating leases	$	4,961	$	4,034	$	4,318
Operating cash flows from finance leases	10		14		15
Financing cash flows from finance leases	57		102		217
ROU assets obtained in exchange for lease obligations:
Operating leases	1,993		3,298		676
Finance leases	—		60		159

Supplemental balance sheet information related to leases was as follows:

	December 31,			December 31,
	2021			2020
Finance leases:
Investments in real estate, net (1)	$	30		$	62
Property, plant and equipment, at cost	$	127		$	127
Accumulated amortization	(70)			(44)
Property and equipment, net	$	57		$	83
Current portion of notes payable and long-term debt	$	55		$	57
Notes payable, long-term debt and other obligations, less current portion	41			96
Total finance lease liabilities	$	96		$	153
Weighted average remaining lease term in years:
Operating leases	3.36			4.23
Finance leases	1.84			2.71
Weighted average discount rate:
Operating leases	9.60		%	10.20		%
Finance leases	8.21		%	7.82		%

_____________________________

(1)Included in Investments in real estate, net on the consolidated balance sheets are finance lease equipment, at a cost of $748 and $748 and accumulated amortization of $718 and $686 as of December 31, 2021 and 2020, respectively.

As of December 31, 2021, maturities of lease liabilities were as follows:

	Operating Leases		Finance  Leases
Year Ending December 31:
2022	$	4,889	$	61
2023	4,181		35
2024	3,453		8
2025	2,086		—
2026	319		—
Thereafter	—		—
Total lease payments	14,928		104
Less imputed interest	(2,237)		(8)
Total	$	12,691	$	96

The Company has one lease for office space wherein the lessor is an affiliate of a significant stockholder of the Company. This lease represents $571 of the ROU asset balances and $616 of lease liability balances as of December 31, 2021. The rent expense for this lease was approximately $458 for the year ended December 31, 2021.

As of December 31, 2021, the Company had no undiscounted lease payments relating to leases that have not yet commenced.

The Company’s rental expense for the years ended December 31, 2021, 2020 and 2019 was $4,578, $4,572 and $4,552, respectively. Rent expense for the year ended December 31, 2021 consisted of $3,275 of amortization and $1,303 of lease expense for interest accretion on operating lease liabilities. Rent expense for the year ended December 31, 2020 consisted of $3,170 of amortization and impairment of ROU assets and $1,402 of lease expense for interest accretion on operating lease

liabilities. Rent expense for the year ended December 31, 2019 consisted of $3,033 of amortization and impairment of ROU assets and $1,519 of lease expense for interest accretion on operating lease liabilities.

Leases

LEASES

The Company has operating and finance leases for corporate and sales offices, and certain vehicles and equipment accounted for under ASC 842. The leases have remaining lease terms of one year to five years, some of which include options to extend for up to five years, and some of which include options to terminate the leases within one year. However, the Company in general is not reasonably certain to exercise options to renew or terminate, and therefore renewal and termination options are not considered in the lease term or the ROU asset and lease liability balances. The Company’s lease population includes purchase options on equipment leases that are included in the lease payments when reasonably certain to be exercised. The Company’s lease population does not include any residual value guarantees. The Company’s lease population does not contain any material restrictive covenants.

The Company has leases with variable payments, most commonly in the form of Common Area Maintenance (“CAM”) and tax charges which are based on actual costs incurred. These variable payments were excluded from the ROU asset and lease liability balances since they are not fixed or in-substance fixed payments. Variable payments are expensed as incurred.

The components of lease expense were as follows:

	Year Ended December 31,
	2021		2020		2019
Operating lease cost	$	4,578	$	4,572	$	4,636
Short-term lease cost	374		349		338
Variable lease cost	320		634		623
Finance lease cost:
Amortization	58		111		224
Interest on lease liabilities	9		14		15
Total lease cost	$	5,339	$	5,680	$	5,836

Supplemental cash flow information related to leases was as follows:

	Year Ended December 31,
	2021		2020		2019
Cash paid for amounts included in measurement of lease liabilities:
Operating cash flows from operating leases	$	4,961	$	4,034	$	4,318
Operating cash flows from finance leases	10		14		15
Financing cash flows from finance leases	57		102		217
ROU assets obtained in exchange for lease obligations:
Operating leases	1,993		3,298		676
Finance leases	—		60		159

Supplemental balance sheet information related to leases was as follows:

	December 31,			December 31,
	2021			2020
Finance leases:
Investments in real estate, net (1)	$	30		$	62
Property, plant and equipment, at cost	$	127		$	127
Accumulated amortization	(70)			(44)
Property and equipment, net	$	57		$	83
Current portion of notes payable and long-term debt	$	55		$	57
Notes payable, long-term debt and other obligations, less current portion	41			96
Total finance lease liabilities	$	96		$	153
Weighted average remaining lease term in years:
Operating leases	3.36			4.23
Finance leases	1.84			2.71
Weighted average discount rate:
Operating leases	9.60		%	10.20		%
Finance leases	8.21		%	7.82		%

_____________________________

(1)Included in Investments in real estate, net on the consolidated balance sheets are finance lease equipment, at a cost of $748 and $748 and accumulated amortization of $718 and $686 as of December 31, 2021 and 2020, respectively.

As of December 31, 2021, maturities of lease liabilities were as follows:

	Operating Leases		Finance  Leases
Year Ending December 31:
2022	$	4,889	$	61
2023	4,181		35
2024	3,453		8
2025	2,086		—
2026	319		—
Thereafter	—		—
Total lease payments	14,928		104
Less imputed interest	(2,237)		(8)
Total	$	12,691	$	96

The Company has one lease for office space wherein the lessor is an affiliate of a significant stockholder of the Company. This lease represents $571 of the ROU asset balances and $616 of lease liability balances as of December 31, 2021. The rent expense for this lease was approximately $458 for the year ended December 31, 2021.

As of December 31, 2021, the Company had no undiscounted lease payments relating to leases that have not yet commenced.

The Company’s rental expense for the years ended December 31, 2021, 2020 and 2019 was $4,578, $4,572 and $4,552, respectively. Rent expense for the year ended December 31, 2021 consisted of $3,275 of amortization and $1,303 of lease expense for interest accretion on operating lease liabilities. Rent expense for the year ended December 31, 2020 consisted of $3,170 of amortization and impairment of ROU assets and $1,402 of lease expense for interest accretion on operating lease

liabilities. Rent expense for the year ended December 31, 2019 consisted of $3,033 of amortization and impairment of ROU assets and $1,519 of lease expense for interest accretion on operating lease liabilities.