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Note 7 - Lease Obligations

9 Months Ended

Sep. 30, 2025

Note 7.

Lease Obligations

The finance leases in effect at September 30, 2025 terminate from June 2028 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, 2025 and 2024 are as follows:

(dollars in thousands)	Three Months Ended			Three Months Ended			Nine Months Ended			Nine Months Ended
	September 30, 2025			September 30, 2024			September 30, 2025			September 30, 2024
Finance lease cost:
Amortization of right-of-use assets	$	218		$	122		$	655		$	368
Interest on lease liabilities		112			215			355			636
Operating lease cost		3,390			3,648			11,219			10,607
Variable lease cost		(3	)		50			(71	)		199
Short-term lease cost		1,652			802			4,336			2,776
Total lease cost	$	5,369		$	4,837		$	16,494		$	14,586

Other information
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases		112			215			355			636
Operating cash flows from operating leases		2,534			2,851			8,578			8,286
Financing cash flows from finance leases		190			188			555			553
Right-of-use assets obtained in exchange for new finance lease liabilities		-			-			-			815
Right-of-use assets obtained in exchange for new operating lease liabilities		702			4,783			4,991			13,753
Weighted-average remaining lease term—finance leases (in years)		4.9			3.5
Weighted-average remaining lease term—operating leases (in years)		3.8			4.6
Weighted-average discount rate—finance leases		6.1	%		13.5	%
Weighted-average discount rate—operating leases		8.8	%		8.6	%

As of September 30, 2025 and December 31, 2024, right-of-use assets of $36.0 million and $40.0 million for operating leases and $3.0 million and $4.6 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, 2025, are summarized as follows by lease category:

(in thousands)	*Operating*			*Finance*
2025 ⁽¹⁾		3,473		$	303
2026		13,695			1,212
2027		12,148			1,212
2028		6,450			930
2029		3,703			340
Thereafter		4,563			529
Total minimum lease payments	$	44,032		$	4,526
Less: amount representing interest		(5,948	)		(1,138	)
Present value of minimum lease payments	$	38,084		$	3,388
Less: current portion		(11,266	)		(817	)
Lease obligations, long-term	$	26,818		$	2,571

⁽¹⁾ Excludes the nine months ended September 30, 2025.