Note 11 - Leases

6 Months Ended

Jun. 30, 2023

Notes to Financial Statements

Lessee, Operating Leases [Text Block]

11. Leases

Right-of-use assets and lease liabilities related to operating leases under ASC Topic 842, Leases (“ASC Topic 842”), are recorded when the Company and its subsidiaries are party to a contract, which conveys the right for it to control an asset for a specified period of time. Substantially all of our operating lease arrangements relate to rented office space and real estate for our title operations. We generally are not a party to any material contracts considered finance leases. Right-of-use assets and lease liabilities under ASC Topic 842 are recorded as Lease assets and Lease liabilities, respectively, on the Unaudited Consolidated Balance Sheets.

Our operating leases range in term from one to three years. As of June 30, 2023, the weighted-average remaining lease term of our operating leases was 2.65 years.

Our lease agreements do not contain material variable lease payments, buyout options, residual value guarantees or restrictive covenants.

Most of our leases include one or more options to renew, with renewal terms that can extend the lease term by varying amounts. The exercise of lease renewal options is at our sole discretion. We do not include options to renew in our measurement of lease assets and lease liabilities as they are not considered reasonably assured of exercise.

The lease liability is determined by discounting future lease payments using a discount rate based on our incremental borrowing rate for similar collateralized borrowing. The discount rate is calculated using estimates of capitalization rates and borrowing rates. As of June 30, 2023, the weighted-average discount rate used to determine our operating lease liability was 6.0%.

Lease expense included in general and administrative expenses on the Unaudited Consolidated Statements of Operations was $177,000 and $172,000 for the three months ended June 30, 2023, and 2022, respectively, and $403,000 and $326,000 for the six months ended June 30, 2023, and 2022, respectively.

Future payments under operating lease arrangements accounted for under ASC Topic 842 for each twelve month period following June 30, 2023 are as follows (in thousands):

2024	$	346
2025		229
2026		100
2027		52
2028		21
Total lease payments, undiscounted	$	748
Less: present value discount		(55	)
Lease liabilities, at present value	$	693