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LEASES

3 Months Ended

Mar. 31, 2019

14.

LEASES

The Company adopted ASU No. 2016-02, Leases (Topic 842) on January 1, 2019 and recognized leases with duration greater than 12 months on the balance sheet using the modified retrospective approach. Prior year financial statements have not been restated and therefore those amounts are not presented below. In addition, the Company elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed for a carry-forward of the historical lease classification. For leases with terms greater than 12 months, the Company has recorded the related Right-Of-Use asset and liability at the present value of lease payments over the term. Renewal options have been factored into the determination of lease payments when appropriate. There are no residual value guarantees on the existing leases. The Company estimates its incremental borrowing rate, at lease commencement, to determine the present value of lease payments, since most of the Company’s leases do not provide an implicit rate of return.

The Company’s lease population consists primarily of office equipment. The Company does not have any finance leases. The Company determines at contract inception, if an arrangement is a lease or contains a lease based on whether the Company obtains the right to control the use of specifically identifiable property, plant and equipment for a period of time in exchange for consideration. The Company has elected not to separate non-lease components from lease components for its leases. Variable lease payments are recognized as expense when incurred.

As of March 31, 2019, the Company had no operating leases that had not yet commenced.

Lease position:

The table below presents the assets and liabilities related to operating leases recorded on the balance sheet:

(in thousands)		Classification on the Consolidated Balance Sheet		March 31, 2019
Assets:
Operating lease right-of-use assets		Other assets		$	193

Liabilities:
Current maturities of operating leases		Accrued expenses and other liabilities		$	46
Long-term operating lease liabilities		Other long-term liabilities			145
Total lease liabilities				$	191

Lease Costs:

The components of lease expense for the period are reported as follows:

(in thousands)		Classification on the Consolidated Statements of Operations		Three months ended March 31, 2019
Operating lease cost		Selling, general and administrative expenses		$	13
Short-term lease cost		Selling, general and administrative expenses			1
Total lease cost				$	14

Other information:

Cash paid for amounts included in the measurement of lease liabilities –operating leases (in thousands)		$	11
Weighted average remaining lease term –operating leases			4.2	years
Weighted average discount rate – operating leases			3.68	%

Lease Commitments:

Future minimum lease payments at March 31, 2019 were as follows:

Maturity of lease liabilities (in thousands)		Operating Leases
2019 (excluding the three months ended March 31, 2019)		$	41
2020			52
2021			52
2022			52
2023			10
Thereafter			-
Total lease payments			207
Less: Amounts representing interest			(16	)
Present value of lease liabilities		$	191