NOTE

–

LEASES

The Company has operating leases for corporate offices, vehicles and office equipment. The Company’s leases have remaining lease terms of

months to

months as of

March 31, 2020,

some of which include options to extend or terminate the lease. However, the Company is

not

reasonably certain to exercise options to renew or terminate, and therefore renewal and termination options are

not

considered in the lease term or the right-of-use asset and lease liability balances. The Company's current lease arrangements expire from

2020

through

2021.

The Company does

not

have any finance leases.

Lease balances

. Amounts recognized in the accompanying consolidated balance sheet as of

March 31, 2020

and

December 31, 2019

are as follows (in thousands):

As of March 31, 2020
Activity	Balance Sheet Location	Balance
ROU assets	Other assets	$	48
Short-term lease liability	Other liabilities	$	45
Long-term lease liability	Other long-term liabilities	$	3

As of December 31, 2019
Activity	Balance Sheet Location	Balance
ROU assets	Other assets	$	59
Short-term lease liability	Other liabilities	$	44
Long-term lease liability	Other long-term liabilities	$	15

Lease cost.

The Company’s operating lease cost for the

three

months ended

March 31, 2020

was

$11,625.

Lease commitments.

The table below summarizes the Company’s scheduled future minimum lease payments under operating, recorded on the balance sheet as of

March 31, 2020 (

in thousands):

2020	$	35
2021		15
Total lease payments		50
Less: Imputed interest		(2	)
Present value of lease payments		48
Less: current maturities of lease obligations		(45	)
Long-term lease obligations	$	3

The table below presents additional information related to our leases as of

March 31, 2020:

Weighted Average Remaining Lease Term
Operating leases (years)	1

Weighted Average Discount Rate
Operating leases	6	%

From a lessor standpoint, in

February 2016,

the Company entered into a lease agreement with Fenner Valley Farms LLC (“FVF”) (the “lessee”), a subsidiary of Water Asset Management LLC, a related party, pursuant to which FVF is leasing, for a

-year term,

2,100

acres owned by Cadiz in San Bernardino County, California, to be used to plant, grow and harvest agricultural crops (“FVF Lease Agreement”). As consideration for the lease, FVF paid the Company a

one

-time payment of

$12.0

million upon closing.

The Company expects to receive rental income of

$420

thousand annually over the next

five

years related to the FVF Lease Agreement.

July 31, 2019,

the JV entered into a lease agreement (the “Lease Agreement”) with the Company whereby the JV will cultivate industrial hemp on up to

9,600

acres at the Company’s agricultural property in eastern San Bernardino County, California (“Cadiz Ranch”). Under the terms of the Agreement, the JV initially leased

1,280

acres at the Cadiz Ranch and holds options to lease up to

8,320

additional acres by

2022.

The Lease Agreement was amended in

March 2020

to reduce the initially leased acreage to

242

and extend the options to lease the remaining acreage until

2023.

The Agreement has an initial term of

five

years and the JV has the option to extend the term for

three

successive periods of

five

years each. In consideration for the lease arrangement, the JV will provide the Company an annual rental payment equal to

$500

per acre of leased property, subject to periodic CPI adjustment. The lease commenced on

March 1, 2020

when the Company completed certain activities to bring the property to the specification required by the JV. Assuming

further options are exercised, the Company expects to receive rental income of approximately

$12

thousand annually over the next

five

years related to the JV Lease Agreement.