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Operating Leases

3 Months Ended

Mar. 31, 2023

6. Operating Leases

The Company has various lease agreements for its offices and service delivery centers. The Company has determined that the risks and benefits related to the leased properties are retained by the lessors. Accordingly, these are accounted for as operating leases.

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%. Most of these agreements are renewable at the mutual consent of the parties to the contract.

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


	For the Three Months Ended
	March 31,
	2023		2022
Rent expense for long-term operating leases	$	309	$	376
Rent expense for short-term leases		95		117
Total rent expense	$	404	$	493

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 March 31, 2023 (in thousands):


Year	Amount
2023	$	761
2024		858
2025		890
2026		927
2027		912
2028 and thereafter		1,553
Total lease payments		5,901
Less: Interest		(1,342)
Net present value of lease liabilities	$	4,559

Current portion	$	633
Long-term portion		3,926
Total	$	4,559

The weighted average remaining lease terms and discount rates for all of the Company’s operating leases as of March 31, 2023 were as follows:


Weighted-average lease term remaining (in months)	49
Weighted-average discount rate	9.10	%