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Leasing Arrangements

12 Months Ended

Dec. 31, 2019

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. Rent expense is recognized on a straight-line basis over the lease term. Rental expense under these leases was $6.5 million, $6.5 million and $5.9 million for the years ended December 31, 2019, 2018 and 2017, respectively.

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



	Year Ended December 31, 2019
Operating lease cost	$	4,816
Amortization of finance lease assets	60
Interest on finance lease liabilities	10
Short-term lease cost	91
Variable lease cost	1,605
Sublease income	(43		)
Total lease cost (1)	$	6,539

(1) Of the total lease cost of $6.5 million during the year ended December 31, 2019, $3.5 million was included within selling, general and administrative expenses, $1.5 million was including within cost of sales, and $1.5 million was included in research and development expenses in the consolidated statement of comprehensive (loss).

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



	Year Ended December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	4,701
Operating cash flows from finance leases	9
Financing cash flows from finance leases	352

Right-of-use assets, net obtained in exchange for new lease obligations:
Operating leases	24,764
Finance leases	$	71

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



	December 31, 2019
Right-of-use assets, net:
Operating leases, gross	$	24,564
Accumulated reduction	(2,119		)
Operating leases, net	$	22,445
Finance leases (included in “Other non-current assets”), gross	72
Accumulated depreciation	(21		)
Finance leases (included in “Other non-current assets”), net	$	51
Total Right-of-use assets, net	$	22,496

Lease liabilities:
Current portion of Operating lease liability	$	2,290
Long-term Operating lease liability	22,021
Total Operating lease liability	$	24,311
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	34
Total Finance lease liability	$	54
Total Lease liabilities	$	24,365

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



	December 31, 2019
Weighted-average remaining lease terms:
Operating leases	8.4 years
Finance leases	2.6 years

Weighted-average discount rates:
Operating leases	10.0	%
Finance leases	5.5	%

The following table sets forth the Company’s scheduled maturities of lease liabilities as of December 31, 2019 (in thousands):



Year ending December 31,	Operating leases		Finance leases
2020	$	4,596	$	23
2021	4,775		22
2022	4,520		13
2023	3,862		—
2024	3,557		—
2025 and beyond	15,345		—
Total lease payments (1)	$	36,655	$	58
Less: Imputed interest	$	12,344	$	4
Total lease liabilities	$	24,311	$	54

(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. As of December 31, 2019, the Company has approximately $11.4 million of reasonably assured renewal option payments included in the total lease payments.

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



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

Leasing Arrangements