We lease property and equipment under operating lease arrangements, most of which relate to distribution centers and manufacturing facilities in the U.S., Honduras, El Salvador, and Mexico. We also lease machinery and equipment under finance lease arrangements in the U.S. We include both the contractual term as well as any renewal option that we are reasonably certain to exercise in the determination of our lease terms. For leases with a term of greater than months, we value lease liabilities and the related assets as the present value of the lease payments over the related term. We apply the short-term lease exception to leases with a term of months or less and exclude such leases from our Condensed Consolidated Balance Sheet. Payments related to these short-term leases are expensed on a straight-line basis over the lease term and reflected as a component of lease cost within our Condensed Consolidated Statements of Operations. Lease payments generally consist of fixed amounts, and variable amounts based on a market rate or an index are material to our consolidated lease cost. Our operating lease agreements for buildings generally include provisions for the payment of our proportional share of operating costs, property taxes, and other variable payments. These incremental payments are excluded from our calculation of operating lease liabilities and right of use assets. We have elected to use the practical expedient present in ASC to separate lease and non-lease components for all significant underlying asset classes and instead account for them together as a single lease component in the measurement of our lease liabilities.

 

Generally, the rate implicit in our operating leases is readily determinable. Therefore, we discount future lease payments using our estimated incremental borrowing rate at lease commencement. We determine this rate based on a credit-adjusted risk-free rate, which approximates a secured rate over the lease term. The weighted average discount rate for operating leases as of was We discount our finance lease payments based on the rate implicit and stated in the lease. The weighted average discount rate for finance leases as of was

 

The following table presents the future undiscounted payments due on our operating and finance lease liabilities as well as a reconciliation of those payments to our operating and finance lease liabilities, recorded as of in thousands):

 

		Operating				Finance
		Leases				Leases
2020		$	5,509			$	3,989
2021			9,488				6,684
2022			8,116				4,475
2023			6,119				3,464
2024			4,675				1,965
Thereafter			17,635				295
Undiscounted fixed lease payments		$	51,542			$	20,872
Discount due to interest			(7,406	)			(1,668)
Total lease liabilities		$	44,136			$	19,204
Less current maturities			(8,525	)			(6,965	)
Lease liabilities, excluding current maturities		$	35,611			$	12,239

 

As of we have entered into certain operating leases that have yet commenced and which will result in annual fixed lease payments that range from million to million per year for a -year period.

 

Our Ceiba Textiles manufacturing facility is leased under an operating lease arrangement with a Honduran company, of which we own of the outstanding capital stock of the lessor at During the -months ended and we paid approximately million in lease payments under this arrangement.

 

As of we recorded million of operating lease, ROU assets which were reflected within Operating lease assets in our Condensed Consolidated Balance Sheet, and million of finance lease ROU assets, which were reflected within Property, plant, and equipment, net in our Condensed Consolidated Balance Sheet.

 

The weighted average remaining lease terms for our operating leases and finance leases were approximately  years and  years, respectively, as of 

 

The components of total lease expense were as follows for the months ended in thousands):

 

Operating lease fixed expense		$	5,513
Operating lease variable cost expense			879
Finance lease amortization of ROU assets expense			1,630
Finance lease interest expense			486
Total lease expense		$	8,508

 

Total operating lease expense, excluding variable lease costs, recognized during the months ended prior to the adoption of ASC was million. In addition, during the months ended we also incurred expenses related to finance leases, including interest expense and depreciation expense of financed Property, plant and equipment.

 

Cash outflows for operating lease payments and interest payments for finance leases during the  months ended were million and million, respectively, and are classified within Net cash used in operating activities on the Condensed Consolidated Statement of Cash Flows. Cash outflows for finance lease payments during the months ended were million and are classified within Net cash provided by financing activities on the Condensed Consolidated Statement of Cash Flows.

 

ROU assets obtained in exchange for operating lease and finance lease liabilities during the months ended were million and million, respectively. During the -month period ended prior to the adoption of ASC we entered into new finance lease obligations totaling million.

 

We do have significant leasing transactions in which we are the lessor.