Financing and Operating Leases

3 Months Ended

Mar. 31, 2022

Financing and Operating Leases

Financing and Operating Leases

9. Financing and Operating Leases

Right-of-use (“ROU”) represents the right to use an underlying asset for the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. A lease is deemed to exist when the Company has the right to control the use of identified property, plant or equipment, as conveyed through a contract, for a certain period of time and consideration paid. The right to control is deemed to occur when the Company has the right to obtain substantially all of the economic benefits of the identified assets and the right to direct the use of such assets.

The components of operating and finance lease costs were as follows:

	Three Months Ended		Three Months Ended
	March 31, 2022		March 31, 2021
Operating lease costs	$	716	$	509
Variable lease costs		139		164
Short-term operating lease costs		-		172
Total expense from operating leases	$	855	$	845
Finance lease cost:
Right-of-use amortization expense		390		293
Interest on lease liabilities		90		106
Total financing lease costs	$	480	$	399

The following table reflects balances for operating and financing leases:

	March 31, 2022		December 31, 2021
Operating leases
Operating lease right-of-use assets, net of amortization	$	12,416	$	12,069
Operating lease liability (current)	$	2,249	$	1,857
Long-term operating liability		10,684		10,703
Total operating lease liabilities	$	12,933	$	12,560
Financing leases
Property, equipment and leasehold improvements	$	12,630	$	9,088
Accumulated depreciation		(2,864)		(2,451)
Total financing leases in property, equipment and leasehold improvements, net	$	9,766	$	6,637
Financing lease liability (current)	$	2,822	$	2,257
Long-term financing liability		5,000		2,668
Total financing lease liabilities	$	7,822	$	4,925

Finance and operating lease ROU assets are recorded in “Plant, equipment, leasehold improvements and operating lease right-of-use assets, net.” Financing and operating lease liabilities are recorded in “Accrued expenses” and “Other long-term liabilities.”

Future cash payment with respect to lease obligations as of March 31, 2022 were as follows:

		Operating		Financing
		Lease		Leases
2022 (excluding the three months ended March 31, 2022)	$	2,400	$	2,603
2022		3,164		2,502
2023		2,896		1,705
2024		2,090		1,414
2025		1,958		446
Thereafter		3,654		40
Total lease payments		16,162		8,710
Less imputed interest		(3,229)		(888)
Total	$	12,933	$	7,822