Leases

3 Months Ended

Mar. 31, 2023

Leases [Abstract]

Leases

Leases

Rockwell leases its production facilities and administrative offices as well as certain equipment used in its operations including leases on transportation equipment used in the delivery of its products. The lease terms range from monthly to six years. Rockwell occupies a 51,000 square foot facility and a 17,500 square foot facility in Wixom, Michigan under a lease expiring in August 2024. Rockwell also occupies two other manufacturing facilities, a 51,000 square foot facility in Grapevine, Texas under a lease expiring in December 2025, and a 57,000 square foot facility in Greer, South Carolina under a lease expiring February 2026. In addition, Rockwell occupied 4,100 square feet of office space in Hackensack, New Jersey under a lease expiring on October 31, 2024. This lease was subleased on December 15, 2021 with an expiration date of October 31, 2024.

At March 31, 2023, the Company had operating and finance lease liabilities of $6.2 million and right-of-use assets of $5.9 million, which are included in the condensed consolidated balance sheet.

At December 31, 2022, the Company had operating and finance lease liabilities of $6.7 million and right-of-use assets of $6.4 million, which are included in the condensed consolidated balance sheet.

The following summarizes quantitative information about the Company’s operating leases (table in thousands):

	Three Months Ended March 31, 2023			Three Months Ended March 31, 2022
Operating leases
Operating lease cost	$	344		$	449
Interest on lease obligations	60			—
Variable lease cost	115			95
Operating lease expense	519			544
Finance leases
Non-cash lease expense from right-of-use assets	141			141
Interest on lease obligations	39			47
Finance lease expense	180			188
Short-term lease rent expense	4			4
Total lease expense	$	703		$	736
Other information
Operating cash flows from operating leases	$	424		$	464
Operating cash flows from finance leases	$	39		$	47
Financing cash flows from finance leases	$	128		$	118
Weighted-average remaining lease term – operating leases	2.8			3.4
Weighted-average remaining lease term – finance leases	4.2			5.2
Weighted-average discount rate – operating leases	6.4		%	6.3		%
Weighted-average discount rate – finance leases	6.4		%	6.4		%

Future minimum rental payments under operating lease agreements are as follows (in thousands):

	Operating		Finance
Year ending December 31, 2023 (remaining)	$	1,249	$	502
Year ending December 31, 2024	1,405		672
Year ending December 31, 2025	937		676
Year ending December 31, 2026	310		666
Year ending December 31, 2027	121		311
Total	$	4,022	$	2,827
Less present value discount	(335)		(345)
Operating and finance lease liabilities	$	3,687	$	2,482

Leases

Leases

Rockwell leases its production facilities and administrative offices as well as certain equipment used in its operations including leases on transportation equipment used in the delivery of its products. The lease terms range from monthly to six years. Rockwell occupies a 51,000 square foot facility and a 17,500 square foot facility in Wixom, Michigan under a lease expiring in August 2024. Rockwell also occupies two other manufacturing facilities, a 51,000 square foot facility in Grapevine, Texas under a lease expiring in December 2025, and a 57,000 square foot facility in Greer, South Carolina under a lease expiring February 2026. In addition, Rockwell occupied 4,100 square feet of office space in Hackensack, New Jersey under a lease expiring on October 31, 2024. This lease was subleased on December 15, 2021 with an expiration date of October 31, 2024.

At March 31, 2023, the Company had operating and finance lease liabilities of $6.2 million and right-of-use assets of $5.9 million, which are included in the condensed consolidated balance sheet.

At December 31, 2022, the Company had operating and finance lease liabilities of $6.7 million and right-of-use assets of $6.4 million, which are included in the condensed consolidated balance sheet.

The following summarizes quantitative information about the Company’s operating leases (table in thousands):

	Three Months Ended March 31, 2023			Three Months Ended March 31, 2022
Operating leases
Operating lease cost	$	344		$	449
Interest on lease obligations	60			—
Variable lease cost	115			95
Operating lease expense	519			544
Finance leases
Non-cash lease expense from right-of-use assets	141			141
Interest on lease obligations	39			47
Finance lease expense	180			188
Short-term lease rent expense	4			4
Total lease expense	$	703		$	736
Other information
Operating cash flows from operating leases	$	424		$	464
Operating cash flows from finance leases	$	39		$	47
Financing cash flows from finance leases	$	128		$	118
Weighted-average remaining lease term – operating leases	2.8			3.4
Weighted-average remaining lease term – finance leases	4.2			5.2
Weighted-average discount rate – operating leases	6.4		%	6.3		%
Weighted-average discount rate – finance leases	6.4		%	6.4		%

Future minimum rental payments under operating lease agreements are as follows (in thousands):

	Operating		Finance
Year ending December 31, 2023 (remaining)	$	1,249	$	502
Year ending December 31, 2024	1,405		672
Year ending December 31, 2025	937		676
Year ending December 31, 2026	310		666
Year ending December 31, 2027	121		311
Total	$	4,022	$	2,827
Less present value discount	(335)		(345)
Operating and finance lease liabilities	$	3,687	$	2,482