LEASES (Notes)

6 Months Ended

Jun. 30, 2020

LEASES

The table below summarizes the right-of-use assets and lease liabilities in the Company's Condensed Consolidated Balance sheets:



Operating Leases	Balance Sheet Classification	June 30, 2020		December 31, 2019
Right-of-use assets	Other assets	$	45,689	$	51,533

Current liabilities	Other current liabilities	$	12,905	$	13,572
Noncurrent liabilities	Other liabilities	36,347		39,076
Total lease liabilities		$	49,252	$	52,648

The Company determines if an agreement is a lease at inception. Right-of-use assets represent the Company’s 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 right-of-use assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As most of the Company’s operating leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on information available at commencement date to present value the lease payments.

The Company has operating leases for sales offices, manufacturing facilities, warehouses and distribution centers, transportation equipment, office equipment and information technology equipment. Some of these leases are noncancelable. Variable or short-term lease costs contained within the Company’s operating leases are not material. Most leases include one or more options to renew, which can extend the lease term from 1 year to 11 years or more. The exercise of lease renewal options is at the Company's sole discretion. Certain leases also include options to purchase the leased property. Leases with an initial term of 12 months or less are not recorded on the Company's Condensed Consolidated Balance sheets. The Company recognizes lease expense for these leases on a straight-line basis over the lease term.

The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise. The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants.

Total lease expense, which is included in Cost of goods sold and Selling, general and administrative expenses in the Company's Consolidated Statements of Income, was $5,990 and $11,209 in the three and six months ended June 30, 2020 and $6,546 and $12,435 in the three and six months ended June 30, 2019, respectively. Cash paid for amounts included in the measurement of lease liabilities for the three and six months ended June 30, 2020, respectively, were $3,897 and $7,994 and are included in Net cash provided by operating activities in the Company's Consolidated Statements of Cash Flows. Cash paid for amounts included in the measurement of lease liabilities for the three and six months ended June 30, 2019, respectively, were $4,549 and $9,233 and are included in Net cash provided by operating activities in the Company's Consolidated Statements of Cash Flows. Right-of-use assets obtained in exchange for operating lease liabilities were $0 and $2,035 during the three and six months ended June 30, 2020 and $9,717 and $14,673 for the three and six months ended June 30, 2019, respectively.

The total future minimum lease payments for noncancelable operating leases were as follows:



	June 30, 2020
2020	$	7,459
2021	13,051
2022	9,474
2023	7,808
2024	6,355
After 2025	11,127
Total lease payments	$	55,274
Less: Imputed interest	(6,022		)
Operating lease liabilities	$	49,252

As of June 30, 2020, the weighted average remaining lease term is 6.3 years and the weighted average discount rate used to determine the operating lease liability is 3.6%.