14. LEASES

Accounting Standards Update ASU No. 2016-02, Leases (Topic 842), requires the Company to recognize a right of use (“ROU”) asset and a lease liability for all leases with terms greater than 12 months. Refer to Note 19 - Recent Accounting Pronouncements for discussion on the adoption of Topic 842.

The Company has operating leases for office space, manufacturing equipment, computer equipment and automobiles. Many leases include one or more options to renew, some of which include options to extend the leases for a long-term period, and some leases include options to terminate the leases within 30 days. In certain of the Company’s lease agreements, the rental payments are adjusted periodically to reflect actual charges incurred for capital area maintenance, utilities, inflation and/or changes in other indexes.

For the three and six months ended June 30, 2019, the components of operating lease expense were as follows (in thousands):


	Three months ended		Six months ended
	June 30, 2019		June 30, 2019
Fixed operating lease expense	$	1,023	$	2,039
Variable operating lease expense		40		79
	$	1,063	$	2,118

Supplemental cash flow information related to the Company’s operating leases for the six-month period ended June 30, 2019 was as follows (in thousands):


Cash paid for amounts included in the measurement of operating leases	$	2,069
ROU assets obtained in exchange for operating lease obligations	$	20,529

The following table presents the lease balances within the Condensed Consolidated Balance Sheet, weighted average remaining lease term, and weighted average discount rates related to the Company’s operating leases as of June 30, 2019 (in thousands except for the weighted average remaining lease term and weighted average discount rate):


Lease assets and liabilities	Classification	Amount
Assets:
Right of use asset	Other long-term assets	$	18,164
Liabilities:
Current
Right of use liability, current	Accrued liabilities	$	3,475
Long-term
Right of use liability, long-term	Other long-term liabilities		15,206
Total ROU lease liabilities		$	18,681

Weighted average remaining lease term			9 years
Weighted average discount rate			2.9	%

The following table presents the maturity of the Company’s operating lease liabilities as of June 30, 2019 (in thousands):


2020	$	3,958
2021		3,195
2022		2,612
2023		2,129
2024		1,832
Thereafter		6,992
Total undiscounted cash flows		20,718
Less: present value discount		(2,037)
Total lease liabilities	$	18,681

As of June 30, 2019, the Company had no additional significant operating or finance leases that had not yet commenced.