4. Leases

At the inception of an arrangement, the Company determines if an arrangement is, or contains, a lease based on facts and circumstances present in that arrangement. Lease classifications, recognition, and measurement are then determined at the lease commencement date.

The Company’s operating lease right-of-use (“ROU”) assets and operating lease liabilities include primarily leases for office and warehouse spaces used to conduct our business. The Company’s operating leases also include a building with land utilized for our waste treatment operations which includes a purchase option (see “Note 15 – Subsequent Events” for a discussion of the purchase of this property by the Company in July 2024). Finance leases consist primarily of processing and transport equipment used by our facilities’ operations.

The components of lease cost for the Company’s leases for the three and six months ended June 30, 2024 and 2023 were as follows (in thousands):

Schedule of Components of Lease Cost

The weighted average remaining lease term and the weighted average discount rate for operating and finance leases at June 30, 2024, were:

Schedule of Weighted Average Lease

The weighted average remaining lease term and the weighted average discount rate for operating and finance leases at June 30, 2023, were:

The following table reconciles the undiscounted cash flows for the operating and finance leases at June 30, 2024, to the operating and finance lease liabilities recorded on the balance sheet (in thousands):

Schedule of Operating and Finance Lease Liability Maturity

Supplemental cash flow and other information related to our leases were as follows for the three and six months ended June 30, 2024, and 2023 (in thousands):

Schedule of Supplemental Cash Flow and Other Information Related to Leases

The addition of the ROU assets obtained in exchange for operating lease liabilities in the second quarter of 2024 resulted from extensions of the terms on two of the Company’s leases.