Lease Obligations

6 Months Ended

Jun. 30, 2020

Leases [Abstract]

Lease Obligations

Lease Obligations

The Company leases offices, processing centers, warehouse spaces and, to a lesser extent, certain equipment. These leases have remaining terms of 1 year to 10 years, some of which have options to extend for up to 10 years and/or options to terminate within 1 year. The options to renew are not recognized as part of the Company’s right-of-use assets and operating lease liabilities as the Company is not reasonably certain that it will exercise these options. In January 2020, the Company amended its existing Houston, Texas headquarters lease agreement by extending the lease term to June 30, 2029 and surrendering back to the landlord floors for which the Company had previously vacated. In July 2020, the Company re-negotiated the abovementioned lease agreement to modify the rent abatement period from October 2023 through February 2024 to July 2020 through March 2021.

In May 2020, the Company amended its Houston data center lease agreement to reflect changes in the monthly base rent throughout the term of the lease and extend the lease term three months to December 2025.

Total operating lease expense, including short-term lease expense was $5.3 million and $5.7 million for the six months ended June 30, 2020 and 2019, respectively.

Future maturities of lease obligations are as follows (in thousands):

For the year ending June 30,	Operating Leases (a)		Finance Leases		Total
2021	$	8,047	$	1,254	$	9,301
2022	9,011		130		9,141
2023	9,826		—		9,826
2024	7,096		—		7,096
2025	9,190		—		9,190
Thereafter	20,036		—		20,036
Total lease payments	63,206		1,384		64,590
Less: imputed interest	(14,441)		(69)		(14,510)
Total	$	48,765	$	1,315	$	50,080

^(a) Future maturities are updated to reflect the rent relief impact related to the Houston data center lease amendment.

The weighted average remaining lease term as of June 30, 2020 and December 31, 2019 was 5.33 years and 4.71 years, respectively. The weighted average discount rate used to determine the operating lease liability at June 30, 2020 and December 31, 2019 was 6.42% and 6.47%, respectively.

	Six Months Ended June 30,
	2020		2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating leases	$	5,169	$	6,261
Equipment finance leases	555		537

Equipment Finance Leases

The Company has entered into equipment finance leases that are due in installments for the purpose of financing the purchase of computer equipment through August 2021. Interest accrues under these leases at a rate of 8.7% per annum, and the leases are collateralized by liens on the computer equipment. The assets are amortized over the lesser of their related lease terms or their estimated useful lives and such charges are reflected within depreciation expense.

Lease Obligations

Lease Obligations

The Company leases offices, processing centers, warehouse spaces and, to a lesser extent, certain equipment. These leases have remaining terms of 1 year to 10 years, some of which have options to extend for up to 10 years and/or options to terminate within 1 year. The options to renew are not recognized as part of the Company’s right-of-use assets and operating lease liabilities as the Company is not reasonably certain that it will exercise these options. In January 2020, the Company amended its existing Houston, Texas headquarters lease agreement by extending the lease term to June 30, 2029 and surrendering back to the landlord floors for which the Company had previously vacated. In July 2020, the Company re-negotiated the abovementioned lease agreement to modify the rent abatement period from October 2023 through February 2024 to July 2020 through March 2021.

In May 2020, the Company amended its Houston data center lease agreement to reflect changes in the monthly base rent throughout the term of the lease and extend the lease term three months to December 2025.

Total operating lease expense, including short-term lease expense was $5.3 million and $5.7 million for the six months ended June 30, 2020 and 2019, respectively.

Future maturities of lease obligations are as follows (in thousands):

For the year ending June 30,	Operating Leases (a)		Finance Leases		Total
2021	$	8,047	$	1,254	$	9,301
2022	9,011		130		9,141
2023	9,826		—		9,826
2024	7,096		—		7,096
2025	9,190		—		9,190
Thereafter	20,036		—		20,036
Total lease payments	63,206		1,384		64,590
Less: imputed interest	(14,441)		(69)		(14,510)
Total	$	48,765	$	1,315	$	50,080

^(a) Future maturities are updated to reflect the rent relief impact related to the Houston data center lease amendment.

The weighted average remaining lease term as of June 30, 2020 and December 31, 2019 was 5.33 years and 4.71 years, respectively. The weighted average discount rate used to determine the operating lease liability at June 30, 2020 and December 31, 2019 was 6.42% and 6.47%, respectively.

	Six Months Ended June 30,
	2020		2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating leases	$	5,169	$	6,261
Equipment finance leases	555		537

Equipment Finance Leases

The Company has entered into equipment finance leases that are due in installments for the purpose of financing the purchase of computer equipment through August 2021. Interest accrues under these leases at a rate of 8.7% per annum, and the leases are collateralized by liens on the computer equipment. The assets are amortized over the lesser of their related lease terms or their estimated useful lives and such charges are reflected within depreciation expense.