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Note 8 - Lease Obligations

9 Months Ended

Sep. 30, 2024

Note 8.

Lease Obligations

The finance leases in effect at September 30, 2024 terminate from May 2025 through November 2033 and contain guarantees of the residual value of the related equipment by us.

A summary of our lease obligations at September 30, 2024 and 2023 are as follows:

(dollars in thousands)	Three Months Ended			Three Months Ended		Nine Months Ended		Nine Months Ended
	September 30, 2024			September 30, 2023		September 30, 2024		September 30, 2023
Finance lease cost:
Amortization of right-of-use assets	$	122		$	54	$	368	$	567
Interest on lease liabilities		215			181		636		305
Operating lease cost		3,648			4,656		10,607		13,901
Variable lease cost		50			87		199		972
Short-term lease cost		802			1,497		2,776		5,630
Total lease cost	$	4,837		$	6,475	$	14,586	$	21,375

Other information
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases		215			181		636		305
Operating cash flows from operating leases		2,851			3,436		8,286		10,614
Financing cash flows from finance leases		188			1,923		553		5,432
Right-of-use assets obtained in exchange for new finance lease liabilities		-			2,799		815		5,938
Right-of-use assets obtained in exchange for new operating lease liabilities		4,783			-		13,753		3,992
Weighted-average remaining lease term—finance leases (in years)		3.5
Weighted-average remaining lease term—operating leases (in years)		4.6
Weighted-average discount rate—finance leases		13.5	%
Weighted-average discount rate—operating leases		8.6	%

As of September 30, 2024, and December 31, 2023, right-of-use assets of $42.9 million and $41.2 million for operating leases and $6.6 million and $6.4 million for finance leases, respectively, are included in net property and equipment in our condensed consolidated balance sheets. Operating lease right-of-use asset amortization is included in revenue equipment rentals and purchased transportation and general supplies and expenses, depending on the underlying asset, in the condensed consolidated statement of operations. Amortization of finance leased assets is included in depreciation and amortization expense in the condensed consolidated statement of operations.

Our future minimum lease payments as of September 30, 2024, are summarized as follows by lease category:

(in thousands)	*Operating*			*Finance*
2024 ⁽¹⁾	$	3,739		$	443
2025		13,083			1,770
2026		11,560			1,768
2027		10,386			1,768
2028		5,944			1,487
Thereafter		8,186			1,703
Total minimum lease payments	$	52,898		$	8,939
Less: amount representing interest		(8,310	)		(2,601	)
Present value of minimum lease payments	$	44,588		$	6,338
Less: current portion		(10,980	)		(985	)
Lease obligations, long-term	$	33,608		$	5,353

⁽¹⁾ Excludes the nine months ended September 30, 2024.