The Company determines if a contract contains a lease at inception. Material operating leases consist of real estate and operating equipment leases. Generally, the lease term is the minimum of the noncancelable period of the lease term inclusive of reasonably certain renewal periods.

Operating lease assets and liabilities are recognized at the lease commencement date. Operating lease liabilities represent the present value of lease payments not yet paid. Operating lease assets represent the Company's right to use an underlying asset and are based upon the operating lease liabilities adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets, if any. To determine the present value of lease payments not yet paid, the Company estimates incremental secured borrowing rates corresponding to the maturities of the leases.

Operating lease assets are reflected on the Company's balance sheet within Operating lease right-of-use assets and the related short-term and long-term liabilities are included within Current and Long-term operating lease liabilities, respectively. The Company's lease expense is recognized over the lease term. The Company records lease expense as lease payments are made. The Company considered the impact of straight-line treatment and noted no material difference in any given one year.

The Company leased a portion of its Louisville, Kentucky facility from a related party (see Note 6 - Related Party Transactions) under an operating lease that was due to expire December 31, 2017 (the "7100 Prior Lease"). The lease amount was $53.8 thousand per month. Effective October 1, 2017, the Company entered into a new lease agreement with a related party for the same property (the "7100 Lease") that terminates and replaces the 7100 Prior Lease. The lease is for a period of seven years with rent payments of $37.5 thousand per month for the first five years. For each of the following one year periods, the annual rent increases the lesser of (a) the percentage change in the CPI over the preceding twelve months, or (b) 2% of the previous year's annual rent. The Company has the option to extend the lease for two additional consecutive terms, each such extended term to be for a period of five years. In addition, the Company is responsible for real estate taxes, insurance, utilities and maintenance expense.

The Company signed a lease, effective December 1, 2014, to lease a facility in the Seymour, Indiana area. This lease was for an initial period of three years, with the option to extend the lease for three (3) additional three (3) year periods. Rent is $8.0 thousand per month and increases each year by $0.2 thousand per month. The Company exercised the first option to extend the lease. Because ISA exercised the option to renew the lease for a second three year term, at the end of the second three year term, ISA has the option to purchase the property.

On April 30, 2015, the Company entered into a lease agreement with LK Property Investments LLC ("LK Property") (see Note 6 - Related Party Transactions), for a portion of the 4.4 acre parcel of real estate located at 6709 Grade Lane, Louisville, Kentucky in the amount of $3.0 thousand per month. The lease terminated on April 14, 2019. The Company entered into a four month extension that terminates August 15, 2019. The monthly payment during the extension is $7.5 thousand per month. The Company paid $30.0 thousand at the time of extension for the aggregate rental due for the entire term of the extension. The Company is required to reimburse the lessor for 40% of the property taxes on the parcel during the term.

On March 3, 2018, the Company entered into a lease agreement to lease a piece of equipment for $3.0 thousand per month. The lease is for a period of five years.

Future minimum lease payments for operating leases for the next five twelve-month periods ending June 30 of each year and thereafter, in thousands, as of June 30, 2019, are as follows:

	Related Party		Other		Total
2020	$	450	$	103	$	553
2021		450		103	553
2022		450		103	553
2023		457		100	557
2024		466		96	562
Thereafter		5,345		232	5,577
Total future operating lease payments		7,618		737		8,355
Less: imputed interest		2,737		141		2,878
Present value of lease liabilities		4,881		596		5,477
Less: current portion of operating lease liabilities		161		69		230
Long-term operating lease liabilities	$	4,720	$	527	$	5,247

Total lease expense for the three months ended June 30, 2019 and June 30, 2018 was $220.8 thousand and $157.4 thousand, respectively. Total lease expense for the six months ended June 30, 2019 and June 30, 2018 was $394.5 thousand and $311.0 thousand, respectively.

The Company's finance leases are included within Net property and equipment with the related liabilities included within Current and Long-term liabilities.

On May 1, 2016, the Company entered into an amended agreement to lease three cranes (the "Crane Lease"). The Crane Lease expires April 30, 2021. Payments are $14.5 thousand per month for the first twelve months following the amendment date, followed by monthly payments of $31.3 thousand thereafter for the remainder of the lease term. There is no bargain purchase option associated with the Crane Lease. Based on the new lease terms, the Company classified the Crane Lease as a finance lease. At inception, the Company recorded a finance lease obligation of $1.3 million. The Company used a weighted average cost of capital of 9.3% to calculate the finance lease obligation.

The Company entered into a finance lease, effective June 2017, to lease two pieces of equipment for use in the Company's operations. The lease is for a period of six years and the payments are $1.4 thousand per month. The Company has the option to purchase the equipment for a purchase price of $1.00 per item of equipment upon the expiration of the lease. At inception, the Company recorded a finance lease obligation of $75.2 thousand. The Company used a weighted average cost of capital of 10.0% to calculate the finance lease obligation.

The Company entered into a finance lease, effective May 2018, to lease a piece of equipment for use in the Company's operations. The lease is for a period of four years and the payments are $0.6 thousand per month with an interest rate of 5.8% per year. At inception, the Company recorded a finance lease obligation of $24.7 thousand.

The Company entered into a finance lease, effective June 2018, to lease a piece of equipment for use in the Company's operations. The lease is for a period of four years and the payments are $0.7 thousand per month with an interest rate of 5.8% per year. At inception, the Company recorded a finance lease obligation of $29.0 thousand.

The Company entered into a finance lease, effective July 2018, to lease two pieces of equipment for use in the Company's operations. The lease is for a period of 6 years and 4 months and the payments are $1.4 thousand per month. The Company has the option to purchase the equipment for a purchase price of $1.00 per item of equipment upon the expiration of the lease. At inception, the Company recorded a finance lease obligation of $79.9 thousand. The Company used a weighted average cost of capital of 10.0% to calculate the finance lease obligation.

The Company entered into a finance lease, effective May 2019, to lease a piece of equipment for use in the Company's operations. The lease is for a period of six years and the payments are $4.8 thousand per month with an interest rate of 5.0% per year. The Company has the option to purchase the equipment for a purchase price of $1.00 per item of equipment upon the expiration of the lease. At inception, the Company recorded a finance lease obligation of $299.2 thousand.

Depreciation and interest expense for finance leases, in thousands, are as follows:

Accumulated depreciation and net book value for finance leases, in thousands, are as follows:

Future minimum lease payments for finance leases for the next five twelve-month periods ending June 30 of each year, in thousands, as of June 30, 2019 are as follows: