LEASES

3 Months Ended

Mar. 31, 2020

LEASES

LEASES

NOTE 16.    LEASES

We lease manufacturing and office space under non-cancelable operating leases. Some of these leases contain provisions for landlord funded leasehold improvements which are recorded as a reduction to right-of-use (“ROU”) assets and the related operating lease liabilities. For leases containing an option to renew, we regularly evaluate the renewal options and when they are reasonably certain of exercise, we include the renewal period in our lease terms, along with the ROU assets and operating lease liabilities. In many cases, we have lease terms that are less than one year and therefore, we have elected the practical expedient to exclude these short-term leases from our ROU assets and operating lease liabilities. New leases are negotiated and executed to meet business objectives on an on-going basis. 

Our leases do not provide an implicit rate. Accordingly, we use our incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payments. We have a centrally managed treasury function; therefore, we apply a portfolio approach for determining the incremental borrowing rate applicable to the lease term.

Components of operating lease cost were as follows:

	Three Months ended March 31,
	2020		2019
Operating lease cost	$	4,834	$	1,850
Short-term and variable lease cost		1,308		946
Total operating lease cost	$	6,142	$	2,796

Maturities of our operating lease liabilities at March 31, 2020 are as follows:

Year Ending December 31,
2020 (remaining)	$	17,054
2021		20,395
2022		13,981
2023		11,234
2024		10,104
Thereafter		70,826
Total lease payments		143,594
Less: Interest		(30,105)
Present value of lease liabilities	$	113,489

Other information related to leases, including supplemental cash flow information, consists of:

	Three Months ended March 31,
	2020		2019
Cash paid for operating leases	$	5,574	$	2,891
Right-of-use assets obtained in exchange for operating lease liabilities(1)	$	22,208	$	38,311

⁽¹⁾ In the three months ended March 31, 2019, we implemented ASC 842, Leases. The previously reported amount includes leases existing on January 1, 2019.

The weighted average remaining lease term and discount rate related to our lease liabilities as of March 31, 2020 were 9.7 years and 4.3%, respectively. As of March 31, 2019, the weighted average remaining lease term and discount rate related to our lease liabilities were 8.4 years and 3.8%, respectively.