Leases

3 Months Ended

Sep. 30, 2021

Note 7. Leases

We are party to a lease agreement for approximately 32,800 square feet of office space in San Diego, California. We have accounted for the lease as an operating lease. The contractual lease term began in July 2020 and is scheduled to expire in March 2028. The lease contains an option to renew and extend the lease terms. We have not included the lease extension within the ROU asset and lease liability on the balance sheet as it is not reasonably certain to be exercised. The lease includes variable non-lease components (e.g., common area maintenance, maintenance, etc.) that are not included in the ROU asset and lease liability and are reflected as an expense in the period incurred. We do not have any other operating or finance leases. Upon commencement of the lease, we recognized an operating lease ROU asset of $8.7 million and a corresponding operating lease liability of $8.7 million.

The total operating lease costs were as follows (in thousands):


	Three Months Ended September 30,
	2021		2020
Operating lease cost	$	377	$	377

Supplemental cash flow information related to our operating leases were as follows (in thousands):


	Three Months Ended September 30,
	2021		2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	380	$	123
Right-of-use assets obtained in exchange for operating lease obligations:		—		8,689

The following is a schedule of the future minimum rental payments for our operating lease, reconciled to the lease liability as of September 30, 2021 (in thousands):


	September 30, 2021
Remainder of fiscal year ending June 30, 2022	$	1,139
Years ending June 30,
2023		1,565
2024		1,612
2025		1,168
2026		1,710
2027		1,761
Thereafter		1,360
Total lease payments		10,315
Less: Present value discount		(2,243	)
Total operating lease liability	$	8,072
Balance Sheet Classification – Operating Lease
Operating lease liability	$	957
Operating lease liability, long-term		7,115
Total operating lease liability	$	8,072
Other Balance Sheet Information – Operating Lease
Weighted average remaining lease term (in years)		6.5
Weighted average discount rate		7.50	%