Note 6 – Leases

The Company leases certain real estate for commercial, production, and retail purposes, as well as equipment from third parties. Lease expiration dates are between 2019 and 2026. A portion of leases are denominated in foreign currencies.

For both operating and finance leases, the Company recognizes a right-of-use asset, which represents the right to use the underlying asset for the lease term, and a lease liability, which represents the present value of our obligation to make payments arising over the lease term.

We elected the short-term lease exemption for all leases that qualify. This means leases having an initial term of twelve months or less are not recorded on the balance sheet and the related lease expense is recognized on a straight-line basis over the term of the lease.

The Company's leases may include options to extend or terminate the lease. Renewal options generally range from one to ten years and the options to extend are included in the lease term when it is reasonably certain that we will exercise that option. Some leases have variable payments, however, because they are not based on an index or rate, they are not included in the ROU assets and liabilities. Variable payments for real estate leases primarily relate to common area maintenance, insurance, taxes and utilities. Variable payments for equipment, vehicles, and leases within supply agreements primarily relate to usage, repairs, and maintenance. As the implicit rate is not readily determinable for most of the Company's leases, the Company applies a portfolio approach using an estimated incremental borrowing rate, giving consideration to company specific information and publicly available interest rates for instruments with similar characteristics, to determine the initial present value of lease payments over the lease terms.



	Three Months Ended		Three Months Ended
$'s in 000's	March 31, 2020		March 31, 2019
Finance lease cost
Amortization of right-of-use assets	$	391	$	290
Interest on lease liabilities		82		50
Operating lease cost		1,831		910
Variable lease cost(1)		175		72
Short-term lease cost		5		14
Sublease income		(75)		—
Total lease cost	$	2,409	$	1,336

⁽¹⁾

Variable lease cost primarily relates to common area maintenance, property taxes and insurance on leased real estate.

Other information related to leases was as follows as of:


	March 31, 2020	March 31, 2019
Weighted-average remaining lease term (years)
Operating leases	4.82	3.95
Finance leases	2.80	2.65
Weighted-average discount rate
Operating leases	5.3%	5.0%
Finance leases	5.8%	5.5%

Annual future commitments under non-cancelable leases as of March 31, 2020, consist of the following:


	Lease Obligations
$'s in 000's	Operating Leases		Finance Leases
Remainder of 2020	$	4,452	$	1,237
2021		5,137		1,411
2022		4,829		1,225
2023		4,036		1,196
2024		2,516		150
Thereafter		2,957		23
Total minimum future obligations	$	23,927	$	5,242
Less interest		(2,874)		(426)
Present value of net future minimum obligations		21,053		4,816
Less current lease obligations		(4,770)		(1,591)
Long-term lease obligations	$	16,283	$	3,225

Supplemental cash flow information:



	Three Months Ended		Three Months Ended
$'s in 000's	March 31, 2020		March 31, 2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from finance leases	$	82	$	50
Operating cash flows from operating leases		1,798		880
Financing cash flows from finance leases		394		371
(Noncash) right-of-use assets obtained in exchange for lease obligations
Operating leases		1,696		—
Finance leases		381		210