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Note 9 - Leases

12 Months Ended

Dec. 31, 2020

On January 1, 2019, the Company adopted ASU 2016-02, Leases (Topic 842) and all subsequent amendments to the ASU (collectively “ASC 842”) retrospectively through a cumulative-effect adjustment as permitted under the specific transitional provisions in ASC 842. Results for reporting periods beginning after January 1, 2019 are presented under ASC 842, while prior period amounts have not been adjusted and continue to be reported under the accounting standards in effect for the prior period.

The Company primarily leases factories, warehouses, call centers, office space and equipment for various terms under long-term, non-cancelable operating lease agreements. A right-of-use asset represents the Company’s right to use an underlying asset for the lease term and a lease liability represents the Company’s obligation to make lease payments arising from the lease. These leases generally have expected lease terms of one to eight years. In the normal course of business, it is expected that these leases will be renewed or replaced by leases on other properties. Options to renew lease terms are included in determining the right-of-use asset and lease liability when it is reasonably certain that the Company will exercise that option. Certain of the lease agreements include rental payments adjusted periodically for inflation and generally require the Company to pay real estate taxes, insurance, and repairs. The Company’s lease agreements generally do not contain any material residual value guarantees or material restrictive covenants. As of December 31, 2020, the Company had recognized $2.7 million of operating lease liabilities ($1.1 million in other current liabilities and $1.6 million in long-term operating lease liabilities), which represents the present value of the remaining lease payments, and $3.8 million of operating lease right-of-use assets, which includes prepaid rent of $1.5 million. As of December 31, 2019, the Company had recognized $3.7 million of operating lease liabilities ($1.3 million in other current liabilities and $2.4 million in long-term operating lease liabilities), which represents the present value of the remaining lease payments, and $5.4 million of operating lease right-of-use assets, which includes prepaid rent of $1.8 million. The depreciable-life of right-of-use assets is generally limited by the expected lease term. The Company does not have any material leases, individually or in the aggregate, classified as a finance leasing arrangement.

The components of lease cost were as follows (in thousands):

	Years Ended December 31,
	2020		2019		2018
Rent expense (prior to adoption of ASC 842)	$	-	$	-	$	2,149
Operating lease costs		2,000		1,541		-
Short-term lease costs		541		302		-
Total lease costs	$	2,541	$	1,843	$	2,149

Cash flow and noncash information related to our operating leases were as follows (in thousands):

	Years Ended December 31,
	2020		2019
Operating cash flows – cash paid for operating lease liabilities	$	1,425	$	1,320
Non-cash – Operating lease right-of-use assets obtained in exchange for new lease liabilities	$	243	$	782

Other supplemental information related to our operating leases was as follows:

	Years Ended December 31,
	2020			2019
Weighted-average remaining lease term (in years)		2.8			3.6
Weighted average discount rate		5.61	%		5.61	%

Maturities of operating lease liabilities as of December 31, 2020 were as follows (in thousands):

	Operating Leases
2021	$	1,168
2022		961
2023		681
2024		57
2025		60
Thereafter		-
Total lease payments		2,927
Less imputed interest		204
Present value of lease liabilities	$	2,723