The Company leases certain facilities, vehicles and equipment. The Company determines if an arrangement contains a lease at contract inception and recognizes ROU assets and lease liabilities for leases with terms greater than twelve months. Leases with an initial term of twelve months or less are accounted for as short-term leases and are not recognized in the balance sheet. Operating fixed lease expenses and finance lease depreciation expense are recognized on a straight-line basis over the lease term. Variable lease payments which cannot be determined at the lease commencement date, such as reimbursement of lessor expenses, are not included in the ROU assets or lease liabilities.

Many leases include both lease and non-lease components which are primarily related to management services provided by lessors for the underlying assets. The Company elected the practical expedient to account for lease and non-lease components as a single lease component for all leases as well as the practical expedient that allows to carry forward the historical lease classifications. For all new and modified leases entered into after the adoption of ASC 842, the Company reassesses the lease classification and lease term on the effective date of modification. Lease term includes renewal periods if the Company is reasonably certain to exercise any renewal options per the lease contract. The Company’s leases do not contain any material residual value guarantees or restrictive covenants. The Company subleases certain real estate to third parties, however, this activity is not material.

As most leases do not have readily determinable implicit rates, the Company estimates the incremental borrowing rates based on prevailing financial market conditions, comparable companies and credit analysis and management judgments to determine the present values of its lease payments. The Company also applies the portfolio approach to account for leases with similar terms. As of March 31, 2019, the weighted-average remaining lease terms were approximately 4 years for operating leases and 7 years for finance leases. The weighted-average discount rates were 6.1% for operating leases and 5.8% for finance leases.

	Classification	March 31, 2019
Assets
Operating	Other assets	$	63
Finance	Property, plant and equipment, net		7
Total ROU assets		$	70
Liabilities
Current
Operating	Accrued liabilities	$	22
Finance	Other current liabilities		3
Long-term
Operating	Long-term operating lease liabilities		40
Finance	Other long-term liabilities		5
Total lease liabilities		$	70

	Classification	Three Months Ended March 31, 2019
Operating lease cost	Warehousing, selling and administrative	$	8
Finance lease ROU asset depreciation ⁽¹⁾	Warehousing, selling and administrative		1
Short-term lease cost	Warehousing, selling and administrative		2
Variable lease cost	Warehousing, selling and administrative		1

(1)

Included in depreciation and amortization in the consolidated statement of cash flows. Interest on finance lease liabilities is less than $1 million.

	Three Months Ended March 31, 2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	8
Financing cash flows from finance leases ⁽¹⁾		1
ROU assets obtained in exchange for new lease liabilities
Operating		4
Finance		8

(1)

Interest payments from finance lease liabilities is less than $1 million.

Maturity of lease liabilities as of March 31, 2019 were as follows (in millions):

	Operating Lease			Finance Lease
2019	$	19		$	2
2020		20			3
2021		12			2
2022		8			1
2023		6			—
Thereafter		4			2
Total future lease payments		69			10
Less: interest		(7	)		(2	)
Present value of lease liabilities	$	62		$	8