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Note 8 - Leases

9 Months Ended

Sep. 30, 2021

Lessee Operating and Finance Leases [Text Block]

NOTE 8 — LEASES

The Company leases certain facilities and equipment. On January 1, 2019, the Company adopted Accounting Standard Update (“ASU”) 2016-02, Leases (“Topic 842”) and ASU 2018-11 using the cumulative effect method and has elected to apply each available practical expedient. The adoption of Topic 842 resulted in the Company recognizing operating lease liabilities totaling $19,508 with a corresponding right-of-use (“ROU”) asset of $17,613 based on the present value of the minimum rental payments of such leases. The variance between the ROU asset balance and the lease liability is a deferred rent liability that existed prior to the adoption of Topic 842 and was offset against the ROU asset balance during the adoption. The discount rates used for leases accounted for under ASC 842 are based on an interest rate yield curve developed for the leases in the Company’s lease portfolio.

The Company has elected to apply the short-term lease exception to all leases of one year or less. During the nine months ended September 30, 2021 and 2020, the Company had additional operating leases that resulted in right-of-use assets obtained in exchange for lease obligations of $907 and $4,380, respectively. Additionally, during the nine months ended September 30, 2021 and 2020, the Company had additional finance leases that resulted in property, plant, and equipment obtained in exchange for lease obligations of $2,444 and $2,253, respectively.

Some of the Company’s facility leases include options to renew. The exercise of the renewal options is typically at the Company’s discretion. The Company regularly evaluates the renewal options and includes them in the lease term when the Company is reasonably certain to exercise them.

Quantitative information regarding the Company’s leases is as follows:

	*Three Months Ended September 30,*						*Nine Months Ended September 30,*
	*2021*			*2020*			*2021*			*2020*
Components of lease cost
Finance lease cost components:
Amortization of finance lease assets	$	268		$	150		$	709		$	435
Interest on finance lease liabilities		92			64			265			139
Total finance lease costs		360			214			974			574
Operating lease cost components:
Operating lease cost		741			764			2,260			2,340
Short-term lease cost		166			196			540			483
Variable lease cost (1)		220			198			647			586
Sublease income		(47	)		(45	)		(140	)		(136	)
Total operating lease costs		1,080			1,113			3,307			3,273

Total lease cost	$	1,440		$	1,327		$	4,281		$	3,847

Supplemental cash flow information related to our operating leases is as follows for the nine months ended September 30, 2021 and 2020:
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflow from operating leases							$	2,722		$	2,638

Weighted-average remaining lease term-finance leases at end of period (in years)								2.0			1.7
Weighted-average remaining lease term-operating leases at end of period (in years)								9.1			10.2
Weighted-average discount rate-finance leases at end of period								6.4	%		8.9	%
Weighted-average discount rate-operating leases at end of period								8.6	%		8.9	%

(1)

Variable lease costs consist primarily of taxes, insurance, utilities, and common area or other maintenance costs for the Company’s leased facilities and equipment.

As of September 30, 2021, future minimum lease payments under finance leases and operating leases were as follows:

	*Finance*			*Operating*
	*Leases*			*Leases*			*Total*
2021	$	658		$	861		$	1,519
2022		2,143			3,474			5,617
2023		1,487			3,388			4,875
2024		561			2,933			3,494
2025		240			3,015			3,255
2026 and thereafter		55			17,101			17,156
Total lease payments		5,144			30,772			35,916
Less—portion representing interest		(496	)		(10,177	)		(10,673	)
Present value of lease obligations		4,648			20,595			25,243
Less—current portion of lease obligations		(1,886	)		(1,732	)		(3,618	)
Long-term portion of lease obligations	$	2,762		$	18,863		$	21,625