AerSale Corp Leases Disclosure
NOTE Q - LEASES
The Company leases facilities, offices, and equipment. The Company evaluates whether a contractual arrangement that provides it with control over the use of an asset is a lease. The right-of-use (“ROU”) asset and related operating lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the term of the lease. The implicit rate of our lease arrangements is not readily determinable nor is it disclosed by our lessors; therefore, the Company uses its incremental borrowing rate based on information available at the lease commencement date to discount the lease payments. The Company classifies a lease as operating or finance using the classification criteria set forth in ASC Topic 842. Some of our leases are non-cancellable and may include renewal or termination options. Renewal or termination options that are reasonably certain to be exercised are included in the determination of the term of a lease.
The Company’s lease agreements typically do not contain any significant residual value guarantees or restrictive covenants, and may include variable lease payments related to escalation clauses based on consumer price index rates, as well as maintenance and other services. Variable lease payments that depend on an index or rate are included in the determination of ROU asset and lease liabilities using the index or rate at the lease commencement date, whereas variable lease payments that do not depend on an index or rate are recorded as lease expense in the period incurred. Lease expense is recognized over the term of the lease on a straight-line basis unless another systematic basis is more representative of the pattern in which the Company expects to consume the asset’s future economic benefits.
ROU assets are evaluated for impairment in a manner consistent with the treatment of other long-lived assets. The Company made an accounting policy election to not recognize lease assets or liabilities for leases with a term of twelve months or less.
The components of lease expense for the years ended December 31, 2025, 2024, and 2023 were as follows (in thousands):
| Year Ended December 31, | ||||||||
2025 | | 2024 | | 2023 | |||||
Operating lease cost | $ | 6,929 | $ | 6,763 | $ | 7,001 | |||
Short-term lease cost | 1,172 | 1,139 | 392 | ||||||
Variable lease cost | 442 | 869 | 397 | ||||||
$ | 8,543 | $ | 8,771 | $ | 7,790 | ||||
Our operating leases expire at various dates through 2035. Maturities of our operating lease payments as of December 31, 2025 are as follows (in thousands):
| Operating | ||
Leases | |||
Year ending December 31: | |||
2026 | $ | 6,372 | |
2027 | 5,809 | ||
2028 |
| 5,631 | |
2029 |
| 4,691 | |
2030 |
| 4,729 | |
Thereafter |
| 14,649 | |
Total undiscounted payments | 41,881 | ||
Less: imputed interest | (9,378) | ||
Present value of minimum lease payments | 32,503 | ||
Less: Operating lease liabilities - current |
| (4,313) | |
Operating lease liabilities - non-current | $ | 28,190 | |
Our weighted-average remaining lease term and weighted-average discount rate are as follows:
Year Ended December 31, | ||||
| 2025 | | 2024 | |
Remaining lease term (years) | 7.35 | 7.80 | ||
Discount Rate | 6.91% | 6.83% | ||
Supplemental cash flow information related to leases were as follows (in thousands):
| Year Ended December 31, | |||||
2025 | | 2024 | ||||
Cash paid for amounts included in the measurement of lease liabilities | 4,258 | 4,498 | ||||
Operating lease liabilities arising from obtaining ROU assets | 2,080 | 10,449 | ||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 10, 2026 | Showing above |
| 2024 | Mar 11, 2025 | |
| 2023 | Mar 8, 2024 | |
| 2022 | Mar 7, 2023 | |
| 2021 | Mar 15, 2022 | |
| 2020 | Mar 16, 2021 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.