XML 24 R10.htm IDEA: XBRL DOCUMENT

Note D - Leases

12 Months Ended

Dec. 31, 2021

Lessee, Operating and Finance Leases [Text Block]

Note D - Leases

We have operating and finance leases for corporate and business offices, service facilities, call centers and certain equipment. Leases with an initial term of 12 months or less are generally not recorded on the balance sheet, unless the arrangement includes an option to purchase the underlying asset, or an option to renew the arrangement, that we are reasonably certain to exercise (short-term leases). Our leases have remaining lease terms of one year to nine years, some of which may include options to extend the leases for up to an additional five years.

We sublease our Fullerton (CA), Jacksonville (FL) and Uxbridge (UK) facilities. The leases and subleases for these three facilities expire at various dates, the latest being fiscal year 2023.

As of December 31, 2021, assets recorded under finance and operating leases were approximately $0.8 million and $21.4 million respectively, and accumulated amortization associated with finance leases was $0.7 million. As of December 31, 2020, assets recorded under finance and operating leases were approximately $1.0 million and $23.8 million respectively, and accumulated depreciation associated with finance leases was $0.5 million. Operating lease right of use assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. The discount rate used to determine the commencement date present value of lease payment is the interest rate implicit in the lease, or when that is not readily determinable, we utilized our incremental borrowing rate, which is the rate incurred to borrow on a collateralized basis over a similar term at an amount equal to the lease payments in a similar economic environment. Certain adjustments to the right-of-use asset may be required for items such as initial direct costs paid or incentives received.

During the year ended December 31, 2021, we impaired three leases for the facilities we no longer occupied. The resulting impairment and early termination charges are included in our restructuring expenses for the year ended December 31, 2021. During the year ended December 31, 2020, we modified the terms of some of our existing leases which resulted in the re-measurement of the related ROU assets and lease liabilities. We also exercised early termination options and impaired a lease for a facility we were vacating. The resulting impairment and early termination charges are included in our restructuring expenses in the year ended December 31, 2020. Please refer to Note N - Restructuring Activities for more details.

The following tables present supplemental balance sheet information related to our financing and operating leases:

In thousands	*As of December 31, 2021*
	Operating Leases		Finance Leases		Total
Right-of-use Assets	$	21,382	$	760	$	22,142

Liabilities
Short-term lease liabilities		6,359		194		6,553
Long-term lease liabilities		19,004		211		19,215
Total Lease Liabilities	$	25,363	$	405	$	25,768

In thousands	*As of December 31, 2020*
	Operating Leases		Finance Leases		Total
Right-of-use Assets	$	23,793	$	957	$	24,750

Liabilities
Short-term lease liabilities		6,436		227		6,663
Long-term lease liabilities		20,892		403		21,295
Total Lease Liabilities	$	27,328	$	630	$	27,958

For the year ended December 31, 2021 and 2020, the components of lease expense were as follows:

In thousands	*Year Ended December 31, 2021*			*Year Ended December 31, 2020*
Operating lease cost	$	7,745		$	8,646
Finance lease cost
Amortization of right-of-use assets		195			240
Interest on lease liabilities		27			45
Total Finance lease cost		222			285
Variable lease cost		2,604			3,085
Sublease income		(1,153	)		(470	)
Total lease cost, net	$	9,418		$	11,546

Other information related to leases was as follows:

In thousands	*Year Ended December 31, 2021*		*Year Ended December 31, 2020*
Supplemental Cash Flows Information

Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$15,287		$18,777
Operating cash flows from finance leases	25		40
Financing cash flows from finance leases	227		412

Weighted Average Remaining Lease term

Operating leases	6.16		6.05
Finance leases	2.16		2.97

Weighted Average Discount Rate
Operating leases	3.45	%	3.72	%
Finance leases	5.41	%	6.74	%

The maturities of the Company’s finance and operating lease liabilities as of December 31, 2021 are as follows:

In thousands	*Operating Leases (1)*		*Finance Leases*
Year Ending December 31,
2022	$	6,510	$	209
2023		5,285		167
2024		3,856		48
2025		2,119		6
2026		2,014		—
2027 & Beyond		8,229		—
Total future minimum lease payments		28,013		430
Less: Imputed interest		2,650		25
Total lease liabilities	$	25,363	$	405

(1) Non-cancelable sublease proceeds for the fiscal year ending December 31, 2022, and 2023 of $0.7 million and $0.2 million, respectively, are not included in the table above.

As of December 31, 2021, we have no new operating leases that have not yet commenced.