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Leases

12 Months Ended

Dec. 31, 2021

Leases [Abstract]

Leases

Leases

The Company leases certain office and operating facilities, machinery, equipment, and vehicles. Concurrent with the adoption of ASC 842, the Company recognized a right-of-use (ROU) asset and lease liability based on the present value of the future lease payments over the lease term for each lease agreement. The Company elected not to recognize a ROU asset and lease liability for leases with terms of 12 months or less and will continue to recognize lease expense for these leases on a straight-line basis over the lease term. The Company has leases with both lease components and non-lease components, such as common area maintenance, utilities, or other repairs and maintenance. For all asset classes, the Company decided to utilize the practical expedient to include both fixed lease components and fixed non-lease components in calculating the ROU asset and lease liability. The Company identified variable lease payments, such as maintenance payments based on actual activities performed or costs incurred, at lease commencement by assessing the nature of the payment provisions, including whether the payments are subject to a minimum charge. Many of the Company's leases include one or more options to renew. When it is reasonably certain that the Company will exercise the option, the Company will include the impact of the option in the lease term for purposes of determining future lease payments. As the Company is unable to determine the discount rate implicit in its lease agreements, the Company uses its incremental borrowing rate on the commencement date to calculate the present value of future payments.

The Company’s Consolidated Balance Sheets include the following related to operating leases as of December 31, 2021 and 2020:

Leases						Classification						2021						2020
Assets:
ROU assets						Other Assets						$	42,451					$	46,728
Liabilities:
ROU liability - current						Accrued and other current liabilities						$	10,040					$	10,348
ROU liability - long-term						Other liabilities						34,030						37,689
Total ROU liabilities												$	44,070					$	48,037

Included within the balance of operating leases is a lease for the Company’s headquarters which is with a related party. The ROU liability for this facility is approximately $2.9 million as of December 31, 2021 and $3.8 million as of December 31, 2020. Total rent payments for this facility were approximately $1.3 million and $0.7 million during the years ended December 31, 2021 and 2020. An agreement was reached with the related party to reduce rental payments by 20% and defer payments for 90 days for the lease of the Company’s headquarters, starting in June 2020 through December 2020 as part of COVID-19 related lease concessions.

As of December 31, 2021 and 2020, the total ROU assets attributable to finance leases are approximately $13.8 million and $15.8 million, respectively, which is included in Property, plant, and equipment, net on the Consolidated Balance Sheets.

As described in Note 9-Intangible Assets, the Company performed an analysis to determine whether there was any impairment of long-lived assets, which included the ROU assets, within the Services, International, and Products and Systems operating segments as well as Corporate. The result of the analysis was a $0.2 million impairment of a ROU asset in an asset group within

the Services segment which is included in Impairment charges on the consolidated statements of income (loss) for the year ended December 31, 2020.

The components of lease costs for the year ended December 31, 2021 and 2020 are as follows:

						Classification						2021						2020
Finance lease expense:
Amortization of ROU assets						Depreciation and amortization						$	4,111					$	4,544
Interest on lease liabilities						Interest expense						721						847
Operating lease expense						Cost of revenue; Selling, general & administrative expenses						13,042						13,383
Short-term lease expense						Cost of revenue; Selling, general & administrative expenses						27						66
Variable lease expense						Cost of revenue; Selling, general & administrative expenses						2,507						838
Total												$	20,408					$	19,678

Additional information related to leases as of December 31, 2021 and 2020 is as follows:

						2021						2020
Cash paid for amounts included in the measurement of lease liabilities for finance and operating leases:
Finance - financing cash flows						$	4,060					$	4,095
Finance - operating cash flows						721						847
Operating - operating cash flows						13,098						13,246
ROU assets obtained in the exchange for lease liabilities:
Finance leases						$	2,923					2,849
Operating leases						7,021						9,934
Weighted-average remaining lease term (in years):
Finance leases						5.4						5.7
Operating leases						5.3						5.8
Weighted-average discount rate:
Finance leases						5.3		%				5.7		%
Operating leases						5.7		%				5.7		%

Maturities of lease liabilities as of December 31, 2021 is as follows:

			Finance						Operating
2022			$	5,544					$	12,078
2023			3,817						10,602
2024			2,887						8,418
2025			1,296						6,049
2026			646						4,926
Thereafter			441						8,580
Total			14,631						50,653
Less: Present value discount			1,114						6,583
Lease liability			$	13,517					$	44,070

Leases

Leases

The Company leases certain office and operating facilities, machinery, equipment, and vehicles. Concurrent with the adoption of ASC 842, the Company recognized a right-of-use (ROU) asset and lease liability based on the present value of the future lease payments over the lease term for each lease agreement. The Company elected not to recognize a ROU asset and lease liability for leases with terms of 12 months or less and will continue to recognize lease expense for these leases on a straight-line basis over the lease term. The Company has leases with both lease components and non-lease components, such as common area maintenance, utilities, or other repairs and maintenance. For all asset classes, the Company decided to utilize the practical expedient to include both fixed lease components and fixed non-lease components in calculating the ROU asset and lease liability. The Company identified variable lease payments, such as maintenance payments based on actual activities performed or costs incurred, at lease commencement by assessing the nature of the payment provisions, including whether the payments are subject to a minimum charge. Many of the Company's leases include one or more options to renew. When it is reasonably certain that the Company will exercise the option, the Company will include the impact of the option in the lease term for purposes of determining future lease payments. As the Company is unable to determine the discount rate implicit in its lease agreements, the Company uses its incremental borrowing rate on the commencement date to calculate the present value of future payments.

The Company’s Consolidated Balance Sheets include the following related to operating leases as of December 31, 2021 and 2020:

Leases						Classification						2021						2020
Assets:
ROU assets						Other Assets						$	42,451					$	46,728
Liabilities:
ROU liability - current						Accrued and other current liabilities						$	10,040					$	10,348
ROU liability - long-term						Other liabilities						34,030						37,689
Total ROU liabilities												$	44,070					$	48,037

Included within the balance of operating leases is a lease for the Company’s headquarters which is with a related party. The ROU liability for this facility is approximately $2.9 million as of December 31, 2021 and $3.8 million as of December 31, 2020. Total rent payments for this facility were approximately $1.3 million and $0.7 million during the years ended December 31, 2021 and 2020. An agreement was reached with the related party to reduce rental payments by 20% and defer payments for 90 days for the lease of the Company’s headquarters, starting in June 2020 through December 2020 as part of COVID-19 related lease concessions.

As of December 31, 2021 and 2020, the total ROU assets attributable to finance leases are approximately $13.8 million and $15.8 million, respectively, which is included in Property, plant, and equipment, net on the Consolidated Balance Sheets.

As described in Note 9-Intangible Assets, the Company performed an analysis to determine whether there was any impairment of long-lived assets, which included the ROU assets, within the Services, International, and Products and Systems operating segments as well as Corporate. The result of the analysis was a $0.2 million impairment of a ROU asset in an asset group within

the Services segment which is included in Impairment charges on the consolidated statements of income (loss) for the year ended December 31, 2020.

The components of lease costs for the year ended December 31, 2021 and 2020 are as follows:

						Classification						2021						2020
Finance lease expense:
Amortization of ROU assets						Depreciation and amortization						$	4,111					$	4,544
Interest on lease liabilities						Interest expense						721						847
Operating lease expense						Cost of revenue; Selling, general & administrative expenses						13,042						13,383
Short-term lease expense						Cost of revenue; Selling, general & administrative expenses						27						66
Variable lease expense						Cost of revenue; Selling, general & administrative expenses						2,507						838
Total												$	20,408					$	19,678

Additional information related to leases as of December 31, 2021 and 2020 is as follows:

						2021						2020
Cash paid for amounts included in the measurement of lease liabilities for finance and operating leases:
Finance - financing cash flows						$	4,060					$	4,095
Finance - operating cash flows						721						847
Operating - operating cash flows						13,098						13,246
ROU assets obtained in the exchange for lease liabilities:
Finance leases						$	2,923					2,849
Operating leases						7,021						9,934
Weighted-average remaining lease term (in years):
Finance leases						5.4						5.7
Operating leases						5.3						5.8
Weighted-average discount rate:
Finance leases						5.3		%				5.7		%
Operating leases						5.7		%				5.7		%

Maturities of lease liabilities as of December 31, 2021 is as follows:

			Finance						Operating
2022			$	5,544					$	12,078
2023			3,817						10,602
2024			2,887						8,418
2025			1,296						6,049
2026			646						4,926
Thereafter			441						8,580
Total			14,631						50,653
Less: Present value discount			1,114						6,583
Lease liability			$	13,517					$	44,070

X

- References

No definition available.

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X

- Definition

The entire disclosure for finance leases of lessee. Includes, but is not limited to, description of lessee's finance lease and maturity analysis of finance lease liability.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 842
-SubTopic 20
-URI http://asc.fasb.org/subtopic&trid=77888251

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X

- Definition

The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 842
-SubTopic 20
-URI http://asc.fasb.org/subtopic&trid=77888251

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