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Leases

3 Months Ended

Mar. 31, 2019

Leases [Abstract]

Leases

Leases

Lessee

The Company leases multiple office facilities which are contracted under various cancelable and non-cancelable operating leases, most of which provide extension or early termination options. The Company's leases contain one or more options to renew with terms that can extend its current obligations through 2026. The Company's lease agreements do not contain any residual value guarantees or material restrictive covenants.

As of March 31, 2019, the weighted average implicit rate was 4.18% and the weighted average remaining lease term was 3.9 years.

The following table summarizes the components of the Company's leases (in thousands):

	Financial statement caption	March 31, 2019
Balance Sheet
Right-of-use asset - operating	Other Assets	8,289
Lease liability - operating	Accounts payable and other accrued expenses	9,813
Income Statement
Operating lease cost(1)	Administrative expenses	734

(1) Includes short-term leases that are immaterial.

For the three months ended March 31, 2019, cash paid for amounts included in the measurement of lease liabilities of $0.8 million was presented in operating activities on the consolidated statement of cash flows.

The following table summarizes the maturities of lease liabilities as of March 31, 2019 (in thousands):

Years ending December 31,
2019	2,000
2020	2,542
2021	2,146
2022	1,882
2023	1,243
2024 and thereafter	—
Total	9,813

Lessor

The following table summarizes the components of the net investment in finance leases (in thousands):

	March 31, 2019				December 31, 2018
Future minimum lease payment receivable(1)	$	552,603			574,422
Estimated residual receivable(2)	107,386				107,598
Gross finance lease receivables	659,989				682,020
Unearned income(3)	(194,509		)		(203,955		)
Net investment in finance leases(4)	$	465,480			$	478,065

(1) At the inception of the lease, the Company records the total minimum lease payments net of executory costs, if any. The gross finance lease receivable is reduced as billed to the customer and reclassified to accounts receivable until paid. There were no executory costs included in gross finance lease receivables as of March 31, 2019 and December 31, 2018.

(2) The Company's leases generally include a bargain purchase option and therefore, the Company has immaterial residual value risk for assets that are subject to direct finance leases.

(3) The difference between the gross finance lease receivable and the fair value of the equipment at the lease inception is recorded as unearned income. Unearned income together with initial direct costs, are amortized to income over the lease term so as to produce a constant periodic rate of return. There were no unamortized initial direct costs as of March 31, 2019 and December 31, 2018.

(4) As of March 31, 2019, three major customers represented 51%, 25% and 13% of the Company's finance lease portfolio. As of December 31, 2018, three major customers represented 50%, 24% and 13% of the Company's finance lease portfolio. No other customer represented more than 10% of the Company's finance lease portfolio in each of those years.

Contractual maturities of the Company’s gross finance lease receivables subsequent to March 31, 2019 are as follows (in thousands):

Years ending December 31,
2019	83,494
2020	120,130
2021	85,258
2022	78,828
2023	60,929
2024 and thereafter	231,350
Total	659,989

The Company considers an account past due when a payment has not been received in accordance with the terms of the related lease agreement and maintains allowances, if necessary, for doubtful accounts and estimated losses resulting from the inability of its lessees to make required payments under finance leases. These allowances are based on, but not limited to, each lessee’s payment history, management’s current assessment of each lessee’s financial condition and the recoverability. Any accounts in arrears are transferred out of finance lease to determine if a reserve needs to be applied. As of March 31, 2019, the Company does not have an allowance on its gross finance lease receivables.

The Company evaluates potential losses in its finance lease portfolio by regularly reviewing the specific receivables in the

portfolio and analyzing loss experience.

Leases

Leases

Lessee

The Company leases multiple office facilities which are contracted under various cancelable and non-cancelable operating leases, most of which provide extension or early termination options. The Company's leases contain one or more options to renew with terms that can extend its current obligations through 2026. The Company's lease agreements do not contain any residual value guarantees or material restrictive covenants.

As of March 31, 2019, the weighted average implicit rate was 4.18% and the weighted average remaining lease term was 3.9 years.

The following table summarizes the components of the Company's leases (in thousands):

	Financial statement caption	March 31, 2019
Balance Sheet
Right-of-use asset - operating	Other Assets	8,289
Lease liability - operating	Accounts payable and other accrued expenses	9,813
Income Statement
Operating lease cost(1)	Administrative expenses	734

(1) Includes short-term leases that are immaterial.

For the three months ended March 31, 2019, cash paid for amounts included in the measurement of lease liabilities of $0.8 million was presented in operating activities on the consolidated statement of cash flows.

The following table summarizes the maturities of lease liabilities as of March 31, 2019 (in thousands):

Years ending December 31,
2019	2,000
2020	2,542
2021	2,146
2022	1,882
2023	1,243
2024 and thereafter	—
Total	9,813

Lessor

The following table summarizes the components of the net investment in finance leases (in thousands):

	March 31, 2019				December 31, 2018
Future minimum lease payment receivable(1)	$	552,603			574,422
Estimated residual receivable(2)	107,386				107,598
Gross finance lease receivables	659,989				682,020
Unearned income(3)	(194,509		)		(203,955		)
Net investment in finance leases(4)	$	465,480			$	478,065

(1) At the inception of the lease, the Company records the total minimum lease payments net of executory costs, if any. The gross finance lease receivable is reduced as billed to the customer and reclassified to accounts receivable until paid. There were no executory costs included in gross finance lease receivables as of March 31, 2019 and December 31, 2018.

(2) The Company's leases generally include a bargain purchase option and therefore, the Company has immaterial residual value risk for assets that are subject to direct finance leases.

(3) The difference between the gross finance lease receivable and the fair value of the equipment at the lease inception is recorded as unearned income. Unearned income together with initial direct costs, are amortized to income over the lease term so as to produce a constant periodic rate of return. There were no unamortized initial direct costs as of March 31, 2019 and December 31, 2018.

(4) As of March 31, 2019, three major customers represented 51%, 25% and 13% of the Company's finance lease portfolio. As of December 31, 2018, three major customers represented 50%, 24% and 13% of the Company's finance lease portfolio. No other customer represented more than 10% of the Company's finance lease portfolio in each of those years.

Contractual maturities of the Company’s gross finance lease receivables subsequent to March 31, 2019 are as follows (in thousands):

Years ending December 31,
2019	83,494
2020	120,130
2021	85,258
2022	78,828
2023	60,929
2024 and thereafter	231,350
Total	659,989

The Company considers an account past due when a payment has not been received in accordance with the terms of the related lease agreement and maintains allowances, if necessary, for doubtful accounts and estimated losses resulting from the inability of its lessees to make required payments under finance leases. These allowances are based on, but not limited to, each lessee’s payment history, management’s current assessment of each lessee’s financial condition and the recoverability. Any accounts in arrears are transferred out of finance lease to determine if a reserve needs to be applied. As of March 31, 2019, the Company does not have an allowance on its gross finance lease receivables.

The Company evaluates potential losses in its finance lease portfolio by regularly reviewing the specific receivables in the

portfolio and analyzing loss experience.

Leases

Leases

Lessee

The Company leases multiple office facilities which are contracted under various cancelable and non-cancelable operating leases, most of which provide extension or early termination options. The Company's leases contain one or more options to renew with terms that can extend its current obligations through 2026. The Company's lease agreements do not contain any residual value guarantees or material restrictive covenants.

As of March 31, 2019, the weighted average implicit rate was 4.18% and the weighted average remaining lease term was 3.9 years.

The following table summarizes the components of the Company's leases (in thousands):

	Financial statement caption	March 31, 2019
Balance Sheet
Right-of-use asset - operating	Other Assets	8,289
Lease liability - operating	Accounts payable and other accrued expenses	9,813
Income Statement
Operating lease cost(1)	Administrative expenses	734

(1) Includes short-term leases that are immaterial.

For the three months ended March 31, 2019, cash paid for amounts included in the measurement of lease liabilities of $0.8 million was presented in operating activities on the consolidated statement of cash flows.

The following table summarizes the maturities of lease liabilities as of March 31, 2019 (in thousands):

Years ending December 31,
2019	2,000
2020	2,542
2021	2,146
2022	1,882
2023	1,243
2024 and thereafter	—
Total	9,813

Lessor

The following table summarizes the components of the net investment in finance leases (in thousands):

	March 31, 2019				December 31, 2018
Future minimum lease payment receivable(1)	$	552,603			574,422
Estimated residual receivable(2)	107,386				107,598
Gross finance lease receivables	659,989				682,020
Unearned income(3)	(194,509		)		(203,955		)
Net investment in finance leases(4)	$	465,480			$	478,065

(1) At the inception of the lease, the Company records the total minimum lease payments net of executory costs, if any. The gross finance lease receivable is reduced as billed to the customer and reclassified to accounts receivable until paid. There were no executory costs included in gross finance lease receivables as of March 31, 2019 and December 31, 2018.

(2) The Company's leases generally include a bargain purchase option and therefore, the Company has immaterial residual value risk for assets that are subject to direct finance leases.

(3) The difference between the gross finance lease receivable and the fair value of the equipment at the lease inception is recorded as unearned income. Unearned income together with initial direct costs, are amortized to income over the lease term so as to produce a constant periodic rate of return. There were no unamortized initial direct costs as of March 31, 2019 and December 31, 2018.

(4) As of March 31, 2019, three major customers represented 51%, 25% and 13% of the Company's finance lease portfolio. As of December 31, 2018, three major customers represented 50%, 24% and 13% of the Company's finance lease portfolio. No other customer represented more than 10% of the Company's finance lease portfolio in each of those years.

Contractual maturities of the Company’s gross finance lease receivables subsequent to March 31, 2019 are as follows (in thousands):

Years ending December 31,
2019	83,494
2020	120,130
2021	85,258
2022	78,828
2023	60,929
2024 and thereafter	231,350
Total	659,989

The Company considers an account past due when a payment has not been received in accordance with the terms of the related lease agreement and maintains allowances, if necessary, for doubtful accounts and estimated losses resulting from the inability of its lessees to make required payments under finance leases. These allowances are based on, but not limited to, each lessee’s payment history, management’s current assessment of each lessee’s financial condition and the recoverability. Any accounts in arrears are transferred out of finance lease to determine if a reserve needs to be applied. As of March 31, 2019, the Company does not have an allowance on its gross finance lease receivables.

The Company evaluates potential losses in its finance lease portfolio by regularly reviewing the specific receivables in the

portfolio and analyzing loss experience.

X

- References

No definition available.

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- 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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- 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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X

- Definition

The entire disclosure for lessor's operating leases.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 840
-SubTopic 10
-Section 55
-Paragraph 40
-Subparagraph Note 1
-URI http://asc.fasb.org/extlink&oid=82846649&loc=d3e38371-112697

Reference 2: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 840
-SubTopic 10
-Section 55
-Paragraph 40
-Subparagraph Note 3
-URI http://asc.fasb.org/extlink&oid=82846649&loc=d3e38371-112697

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 842
-SubTopic 30
-URI http://asc.fasb.org/subtopic&trid=77888252

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