Leasing Arrangements

6 Months Ended

Jun. 30, 2019

Leases [Abstract]

Leasing Arrangements

Leasing Arrangements

The Company leases real and personal property in the normal course of business under various operating leases and other insignificant finance leases, including non-cancelable and immaterial month-to-month agreements. We recognize rent expense on a straight-line basis over the lease term. During the three and six month periods ended June 30, 2019, total lease cost was $2.1 million and $3.3 million, respectively. During the three and six month period ended June 30, 2018, total lease cost under ASC 840 was $2.5 million and $3.2 million, respectively.

The following table sets forth the Company’s lease cost components (in thousands):

	Three Months Ended June 30, 2019			Six Months Ended June 30, 2019
Operating lease cost	$	1,261		$	2,413
Amortization of finance lease assets	3			49
Interest on finance lease liabilities	1			8
Short-term lease cost	16			27
Variable lease cost	793			793
Sublease income	(6		)	(6		)
Total lease cost (1)	$	2,068		$	3,284

(1) Of the three and six month periods ended June 30, 2019, lease cost amount, $1.1 million and $1.7 million is being reported in selling, general and administrative, $0.4 million and $0.8 million in cost of sales and $0.5 million and $0.8 million in research and development expenses within the Condensed Consolidated Statement of Comprehensive (Loss), respectively.

The following table sets forth the Company’s Supplemental cash flow information related to leases (in thousands):

	Six Months Ended June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	2,363
Operating cash flows from finance leases	8
Financing cash flows from finance leases	338
	As of June 30, 2019
Right-of-use assets, net obtained in exchange for new lease obligations:
Operating leases	23,695
Finance leases	$	71

The following table sets forth the Company’s Supplemental balance sheet information related to leases (in thousands):

	June 30, 2019
Right-of-use assets, net:
Operating leases, gross	$	23,695
Accumulated amortization	1,153
Operating leases, net	$	22,542
Finance leases (included in "Other non-current assets"), gross	71
Accumulated depreciation	11
Finance leases (included in "Other non-current assets"), net	$	60
Total Right-of-use assets, net	$	22,602
Lease liabilities:
Current portion of Operating lease liability	$	2,472
Long-term Operating lease liability	21,877
Total Operating lease liability	$	24,349
Current portion of Finance lease (included in "Accrued expenses and other liabilities") liability	$	20
Long-term Finance lease (included in "Pension obligations and other liabilities") liability	44
Total Finance lease liability	$	64
Total Lease liabilities	$	24,413

The following table sets forth the Company’s Weighted-average lease terms and discount rates (lease term in years):

	June 30, 2019
Weighted-average remaining lease terms:
Operating leases	8.67
Finance leases	3.09
Weighted-average discount rates:
Operating leases	10.00	%
Finance leases	5.50	%

The following table sets forth the Company’s scheduled maturities of lease liabilities as of June 30, 2019 (in thousands):

Year ending December 31,	Operating leases		Finance leases
2019 (last six months of 2019)	$	2,340	$	11
2020	4,594		23
2021	4,476		22
2022	4,214		13
2023	3,548		—
2024 and thereafter	17,913		—
Total lease payments (1)	$	37,085	$	69
Less: Imputed interest	$	12,736	$	5
Total lease liabilities	$	24,349	$	64

(1) Under ASC 842, the Company is required to take into consideration contractual lease renewal options that are reasonably assured to be exercised when determining the lease liability at transition.  As of June 30, 2019, the Company has approximately $11 million of reasonably assured renewal option payments included in the total lease payments.

The following table sets forth the Company’s scheduled of future minimum rental payments for operating leases under ASC 840 as of December 31, 2018 (in thousands):

Year ending December 31,	Operating leases
2019	$	4,564
2020	4,647
2021	4,283
2022	3,724
2023	2,673
2024 and thereafter	6,976
Total lease payments	$	26,867

Leasing Arrangements

Leasing Arrangements

The Company leases real and personal property in the normal course of business under various operating leases and other insignificant finance leases, including non-cancelable and immaterial month-to-month agreements. We recognize rent expense on a straight-line basis over the lease term. During the three and six month periods ended June 30, 2019, total lease cost was $2.1 million and $3.3 million, respectively. During the three and six month period ended June 30, 2018, total lease cost under ASC 840 was $2.5 million and $3.2 million, respectively.

The following table sets forth the Company’s lease cost components (in thousands):

	Three Months Ended June 30, 2019			Six Months Ended June 30, 2019
Operating lease cost	$	1,261		$	2,413
Amortization of finance lease assets	3			49
Interest on finance lease liabilities	1			8
Short-term lease cost	16			27
Variable lease cost	793			793
Sublease income	(6		)	(6		)
Total lease cost (1)	$	2,068		$	3,284

(1) Of the three and six month periods ended June 30, 2019, lease cost amount, $1.1 million and $1.7 million is being reported in selling, general and administrative, $0.4 million and $0.8 million in cost of sales and $0.5 million and $0.8 million in research and development expenses within the Condensed Consolidated Statement of Comprehensive (Loss), respectively.

The following table sets forth the Company’s Supplemental cash flow information related to leases (in thousands):

	Six Months Ended June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	2,363
Operating cash flows from finance leases	8
Financing cash flows from finance leases	338
	As of June 30, 2019
Right-of-use assets, net obtained in exchange for new lease obligations:
Operating leases	23,695
Finance leases	$	71

The following table sets forth the Company’s Supplemental balance sheet information related to leases (in thousands):

	June 30, 2019
Right-of-use assets, net:
Operating leases, gross	$	23,695
Accumulated amortization	1,153
Operating leases, net	$	22,542
Finance leases (included in "Other non-current assets"), gross	71
Accumulated depreciation	11
Finance leases (included in "Other non-current assets"), net	$	60
Total Right-of-use assets, net	$	22,602
Lease liabilities:
Current portion of Operating lease liability	$	2,472
Long-term Operating lease liability	21,877
Total Operating lease liability	$	24,349
Current portion of Finance lease (included in "Accrued expenses and other liabilities") liability	$	20
Long-term Finance lease (included in "Pension obligations and other liabilities") liability	44
Total Finance lease liability	$	64
Total Lease liabilities	$	24,413

The following table sets forth the Company’s Weighted-average lease terms and discount rates (lease term in years):

	June 30, 2019
Weighted-average remaining lease terms:
Operating leases	8.67
Finance leases	3.09
Weighted-average discount rates:
Operating leases	10.00	%
Finance leases	5.50	%

The following table sets forth the Company’s scheduled maturities of lease liabilities as of June 30, 2019 (in thousands):

Year ending December 31,	Operating leases		Finance leases
2019 (last six months of 2019)	$	2,340	$	11
2020	4,594		23
2021	4,476		22
2022	4,214		13
2023	3,548		—
2024 and thereafter	17,913		—
Total lease payments (1)	$	37,085	$	69
Less: Imputed interest	$	12,736	$	5
Total lease liabilities	$	24,349	$	64

(1) Under ASC 842, the Company is required to take into consideration contractual lease renewal options that are reasonably assured to be exercised when determining the lease liability at transition.  As of June 30, 2019, the Company has approximately $11 million of reasonably assured renewal option payments included in the total lease payments.

The following table sets forth the Company’s scheduled of future minimum rental payments for operating leases under ASC 840 as of December 31, 2018 (in thousands):

Year ending December 31,	Operating leases
2019	$	4,564
2020	4,647
2021	4,283
2022	3,724
2023	2,673
2024 and thereafter	6,976
Total lease payments	$	26,867