A lease is defined as an arrangement that contractually specifies the right to use and control an identified asset for a specific period of time in exchange for consideration. Operating leases are included in operating lease assets, portion of operating lease liabilities due within one year, and long-term operating lease liabilities in the Company’s consolidated balance sheets. Finance leases are included in property and equipment, net, other accrued liabilities, and other long-term liabilities in the Company’s consolidated balance sheets. Lease assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Lease assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term, using the Company’s incremental borrowing rate commensurate with the lease term, since the Company’s lessors do not provide an implicit rate, nor is one readily available. The incremental borrowing rate is calculated based on the Company’s credit yield curve and adjusted for collateralization, credit quality and economic environment impact, all where applicable. The lease asset includes scheduled lease payments and excludes lease incentives, such as free rent periods and tenant improvement allowances. The Company has certain leases that may include an option to renew and when it is reasonably probable to exercise such option, the Company will include the renewal option terms in determining the lease asset and lease liability. The Company does not have any renewal options that would have a material impact on the terms of the leases and that are also reasonably expected to be exercised as of July 3, 2021. A lease may contain both fixed and variable payments. Variable lease payments that are linked to an index or rate are measured based on the current index or rate at the implementation of the lease accounting standard, or lease commencement date for new leases, with the impact of future changes in the index or rate being recorded as a period expense. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

The Company’s operating leases are primarily for its studios and corporate offices.

At July 3, 2021 and January 2, 2021, the Company’s lease assets and lease liabilities were as follows:

	July 3, 2021		January 2, 2021
Assets:
Operating lease assets	$	101,382	$	119,102
Finance lease assets		205		207
Total leased assets	$	101,587	$	119,309

Liabilities:
Current
Operating	$	22,877	$	28,551
Finance		116		88
Noncurrent
Operating	$	87,664	$	101,561
Finance		46		93
Total lease liabilities	$	110,703	$	130,293

For the three and six months ended July 3, 2021 and June 27, 2020, the components of the Company’s lease expense were as follows:

	Three Months Ended					Six Months Ended
	July 3,		June 27,			July 3,		June 27,
	2021		2020			2021		2020
Operating lease cost:
Fixed lease cost	$	9,782	$	12,356		$	20,826	$	24,997
Lease termination cost		3,208		143			6,360		143
Variable lease cost		5		(15	)		9		(4	)
Total operating lease cost	$	12,995	$	12,484		$	27,195	$	25,136
Finance lease cost:
Amortization of leased assets		37		41			80		106
Interest on lease liabilities		2		3			5		6
Total finance lease cost	$	39	$	44		$	85	$	112
Total lease cost	$	13,034	$	12,528		$	27,280	$	25,248

At July 3, 2021 and January 2, 2021, the Company’s weighted average remaining lease term and weighted average discount rates were as follows:

	July 3, 2021		January 2, 2021
Weighted Average Remaining Lease Term (years)
Operating leases		7.30		7.08
Finance leases		1.75		2.35

Weighted Average Discount Rate
Operating leases		7.06		6.95
Finance leases		5.02		5.51

The Company’s leases have remaining lease terms of 0 to 11 years with a weighted average lease term of 7.29 years as of July 3, 2021.

At July 3, 2021, the maturity of the Company’s lease liabilities in each of the next five fiscal years and thereafter were as follows:

	Operating Leases		Finance Leases		Total
Remainder of fiscal 2021	$	14,408	$	53	$	14,461
2022		27,741		85		27,826
2023		20,509		27		20,536
2024		15,977		5		15,982
2025		11,589		—		11,589
Thereafter		54,603		—		54,603
Total lease payments	$	144,827	$	170	$	144,997
Less imputed interest		34,286		8		34,294
Present value of lease liabilities	$	110,541	$	162	$	110,703

Supplemental cash flow information related to leases for the six months ended July 3, 2021 and June 27, 2020 were as follows:

	Six Months Ended
	July 3,			June 27,
	2021			2020
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	22,078		$	24,997
Operating cash flows from finance leases	$	5		$	6
Financing cash flows from finance leases	$	80		$	106

Leased assets (modified) obtained in exchange for (modified) new operating lease liabilities	$	(1,012	)	$	8,881
Leased assets obtained in exchange for new finance lease liabilities	$	81		$	118