11. Leases

Lessee arrangements

The Company has operating leases for corporate offices and certain equipment. The Company’s operating leases have remaining lease terms of 1 to 8 years, some of which include options to extend the leases for up to 5 years, and some of which include options to terminate the leases within 3 years.

The components of lease expense are as follows:



	Three Months Ended
	March 31,
(in thousands)	2019		2018

Operating lease cost	$	233	$	285
Short-term lease cost	25		12
Total lease cost	$	258	$	297

Supplemental cash flow information related to leases is as follows:



	Three Months Ended
	March 31,
(in thousands)	2019		2018

Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	215	$	285
Right-of-use-assets obtained in exchange for lease obligations:
Operating leases	$	2,111	N/A

_______________

N/A = Not applicable

The following table presents the lease balances within the Condensed Consolidated Balance Sheet, weighted average remaining lease term, and weighted average discount rates related to the Company’s operating leases (in thousands):



Operating Leases	Classification	March 31, 2019

Operating lease ROU assets	Other assets	$	1,882

Operating lease liabilities, current	Accrued liabilities	$	855
Operating lease liabilities, long-term	Other long-term liabilities	1,064
Total operating lease liabilities	Total operating lease liabilities	$	1,919

Weighted average remaining lease term		2.25 years
Weighted average discount rate		6		%

Maturities of operating lease liabilities as of March 31, 2019 are as follows (in thousands):



Fiscal Year	Amount

2019 (Remaining nine months)	$	707
2020	837
2021	473
2022	—
2023	—
Thereafter	—
Total operating lease payments	2,017
Less: imputed interest	(98		)
Total operating lease liabilities	$	1,919

Future minimum operating lease payments as of December 31, 2018 were as follows (in thousands):



Fiscal Year	Amount

2019	$	1,140
2020	1,003
2021	559
2022	—
2023	—
Thereafter	—
Total	$	2,702

As of March 31, 2019, the Company had no additional significant operating or finance leases that had not yet commenced.

Lessor arrangements

The Company has operating and sales-type leases for medical device equipment generated from its medical devices segment. The Company’s leases have remaining lease terms of less than one year to five years, some of which include options to extend the leases on a month-to-month basis if the customer does not notify the Company of the intention to return the equipment at the end of the lease term. The Company typically does not offer options to terminate the leases before the end of the lease term.

The components of lease income are as follows:



		Three Months Ended
		March 31,
(in thousands)	Classification	2019		2018

Sales-type lease selling price	Product revenue, net	$	—	$	151
Cost of underlying asset		—		(58		)
Operating profit		$	—	$	93

Interest income on the lease receivable	Interest and other income, net	$	12	$	12

Initial direct costs incurred	Operating expense	$	—	$	(8	)

Operating lease Income	Product revenue, net	$	1,237	$	1,285

Net investment in sales-type leases are as follows:



(in thousands)	Classification	March 31, 2019		December 31, 2018

Lease payment receivable, current	Accounts receivable, net and Notes receivable, current	$	458	$	533
Lease payment receivable, long-term	Notes receivable, long-term and Other assets	639		475
Total lease payment receivable		$	1,097	$	1,008

Maturities of sales-type lease receivables as of March 31, 2019 are as follows (in thousands):



Fiscal Year	Amount

2019 (Remaining nine months)	$	368
2020	394
2021	198
2022	150
2023	52
Thereafter	—
Total undiscounted cash flows	1,162
Present value of lease payments (recognized as lease receivables)	1,097
Difference between undiscounted and discounted cash flows	$	65

Maturities of operating lease receivables as of March 31, 2019 are as follows (in thousands):



Fiscal Year	Amount

2019 (Remaining nine months)	$	1,694
2020	1,123
2021	304
2022	26
2023	—
Thereafter	—
Total undiscounted cash flows	$	3,147