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Operating Leases

9 Months Ended

Sep. 30, 2022

6. Operating Leases

The Company has various lease agreements for its offices and service delivery centers. These lease agreements are for terms ranging from two to eleven years and, in most cases, provide for rental escalations ranging from 1.75% to 10%, The Company has determined that the risks and benefits related to these leased properties are retained by the lessors. Accordingly, these are accounted for as operating leases.

Lease Agreements with a term of less than one year are treated as short-term leases and accounted for separately as shown in table below.

Most of these lease agreements are renewable at the mutual consent of the parties to the agreement.

The table below summarizes the amounts recognized in the condensed consolidated financial statements related to operating leases and short-term leases for the periods presented (in thousands):


	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
	2022		2021		2022		2021
Rent expense for long-term operating leases	$	314	$	393	$	1,027	$	1,169
Rent expense for short-term leases		136		59		398		143
Total rent expense	$	450	$	452	$	1,425	$	1,312

The following table presents the maturity profile of the Company’s operating lease liabilities based on the contractual undiscounted payments with a reconciliation of these amounts to the remaining net present value of the operating lease liability reported in the condensed consolidated balance sheet as of September 30, 2022 (in thousands):


Year	Amount
2022	$	283
2023		1,030
2024		825
2025		837
2026		847
2027 and thereafter		2,384
Total lease payments		6,206
Less: Interest		(1,534)
Net present value of lease liabilities	$	4,672

Current portion	$	742
Long-term portion		3,930
Total	$	4,672

The weighted average remaining lease terms and discount rates for all the Company’s operating leases as of September 30, 2022 were as follows:


Weighted-average lease term remaining	55 months
Weighted-average discount rate	8.55	%