Annual report pursuant to Section 13 and 15(d)

Leases

v3.20.4
Leases
12 Months Ended
Dec. 31, 2020
Leases [Abstract]  
Leases Leases
Effective January 1, 2019, the Company accounts for leases under ASU 2016-02, Leases (Topic 842), and related amendments, which requires lessees to recognize a right of use asset and a lease liability for substantially all leases and to disclose key information about leasing arrangements.

The Company primarily leases buildings and equipment. The Company determines if a contract is a lease at the inception of the arrangement. The Company reviews all options to extend, terminate, or purchase its right of use assets at the inception of the lease and accounts for these options when they are reasonably certain of being exercised. Certain real estate leases contain lease and non-lease components, which are accounted for separately.

Leases with an initial term of 12 months or less are not recorded on the consolidated balance sheet. Lease expense for these leases is recognized on a straight-line basis over the lease term.

All of the Company's leases are currently determined to be operating leases.

Components of Lease Expense

The components of lease expense were as follows (in thousands):
Successor Company Predecessor Company
Year Ended December 31, 2020 Period from September 1, 2019 through December 31, 2019 Period from January 1, 2019 through August 31, 2019
Operating lease cost (a) $ 729  $ 160  $ 321 
Operating lease cost (b) 3,923  1,281  2,595 
Total operating lease cost $ 4,652  $ 1,441  $ 2,916 

(a)        Amount is included in Cost of services in the consolidated statements of operations and comprehensive income (loss).
(b)        Amount is included in Selling, general and administrative, including stock-based and long-term incentive compensation in the consolidated statements of operations and comprehensive (loss).

Remaining Lease Term and Discount Rate

The following table presents the weighted-average remaining lease term and the weighted-average discount rate:
As of December 31, 2020
Weighted-average remaining lease term for operating leases (in years) 8.7
Weighted-average discount rate for operating leases 11.7  %
All of the Company's lease contracts do not provide a readily determinable implicit rate. For these contracts, the Company's estimated incremental borrowing rate is based on information available either upon adoption of ASU 2016-02 or at the inception of the lease.

Supplemental Cash Flow Information

The following is the supplemental cash flow information associated with the Company's leases (in thousands):
Successor Company Predecessor Company
Year Ended December 31, 2020 Period from September 1, 2019 through December 31, 2019 Period from January 1, 2019 through August 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Lease payments included in cash flows from operating activities (a) $ 4,525  $ 1,404  $ 2,804 
Right-of-use assets obtained in exchange for new:
Operating lease liabilities $ 1,118  $ 543  $ 91 

(a)        Cash flow impacts from Operating lease right-of-use assets and Operating lease liabilities are presented net on the cash flow statement in changes in Payables and other liabilities.

Maturities of Lease Liabilities

As of December 31, 2020, maturities of lease liabilities were as follows:
2021 $ 3,609 
2022 3,549 
2023 3,182 
2024 3,065 
2025 3,107 
Thereafter 14,157 
Total lease payments $ 30,669 
Less: Interest (11,946)
Total lease obligations $ 18,723