|9 Months Ended|
Mar. 31, 2020
NOTE 3 — RIGHT-OF-USE ASSETS
As discussed in Note 1, the Company adopted ASU 2016-02, Leases (Topic 842) effective July 1, 2019. As of July 1, 2019, the Company had two leases in effect, consisting of (i) a lease for its headquarters location in Redwood City, California that was entered into on January 25, 2019, that provides for monthly rent of approximately $21,000 through the expiration date in March 2022, and (ii) a lease for office space in Bend, Oregon entered into on February 7, 2019, that provides for monthly rent of approximately $2,700 through the expiration date in February 2021. The impact of adoption of ASU 2016-02 resulted in the recognition of right-of-use ("ROU") assets for $0.6 million and operating lease liabilities for the discounted present value of the future lease payments on these leases of approximately $0.6 million. For the three and nine months ended March 31, 2020, under ASC 842 the Company had operating lease expense of approximately $70,000 and $199,000, respectively. For the three and nine months ended March 31, 2019, under the previous lease accounting standard the Company had operating lease expense of approximately $55,000 and $358,000, respectively.
The Company determined the operating lease liability of approximately $633,000 as of July 1, 2019 based upon a discount rate of 10.0% and assuming that the Company will not exercise its option to extend the headquarters lease for an additional three years. The discount rate represents the Company’s estimated incremental borrowing rate for debt with similar lender rights as the underlying operating lease terms.
Balance Sheet Presentation
As of March 31, 2020 and on the adoption date of July 1, 2019, the carrying value of ROU assets and operating lease liabilities are as follows (in thousands):
As of March 31, 2020, the weighted average remaining lease term under operating leases was 1.9 years, and the weighted average discount rate for operating lease liabilities was 10.0%. For the nine months ended March 31, 2020, cash paid for amounts included in the measurement of operating lease liabilities amounted to $205,000, which is included in net cash used in operating activities in the unaudited condensed consolidated statement of cash flows.
Future Lease Payments
Future payments under operating lease agreements as of March 31, 2020 are as follows (in thousands):
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.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef