NOTE 11. LEASES

The Company has lease agreements on a continuing operations basis for office equipment that expire in fiscal years 2021 and 2022. Lease expense included in continuing operations totaled $153,000 and $167,000 for the years ended June 30, 2020, and 2019, respectively.

The Company’s former subsidiary Galileo, which is classified as discontinued operations as described in Note 3, had lease agreements for office equipment and for office facilities. Lease expense included in discontinued operations totaled $74,000 and $109,000 for the years ended June 30, 2020, and 2019, respectively.

For continuing operations, the components of lease expense included in general and administrative expense on the Consolidated Statements of Operations for the year ended June 30, 2020, and qualitative information concerning the Company’s operating leases were as follows:

	Year Ended
	June 30,
(dollars in thousands)	2020
Operating lease cost	$	53
Short-term lease cost		100
Total lease cost	$	153

Cash paid for amounts included in measurement of lease liabilities:
Operating cash flows from operating leases	$	53

Right-of-use assets obtained in exchanged for:
Net operating lease liabilities	$	141

Weighted-average remaining lease term (in years)		1.83
Weighted-average discount rate		4.11	%

Maturities of lease liabilities from continuing operations as of June 30, 2020, are as follows:

(dollars in thousands)
Fiscal Year	Operating Leases
2021	$	53
2022		44
Total lease payments		97
Less imputed interest		(4	)
Total	$	93

The Company is the lessor of certain areas of its owned office building under operating leases expiring in various years through fiscal year 2023. At the commencement of an operation lease, no income is recognized; subsequently, lease payments received are recognized on a straight-line basis. Lease income included in other income on the Consolidated Statements of Operations was $92,000 and $36,000, for fiscal years 2020 and 2019, respectively. The cost of obtaining lessor contracts, which is included in other assets on the Consolidated Balance Sheets, was $7,000 and $0 at June 30, 2020, and June 30, 2019, respectively.

A summary analysis of annual undiscounted cash flows to be received on leases as of June 30, 2020, is as follows:

(dollars in thousands)
Fiscal Year	Operating Leases
2021	$	97
2022		81
2023		34
Total lease payments	$	212

The Company may terminate the building leases with one hundred eighty days written notice if it sells the property. If the Company terminates the lease, the Company will pay the tenant a termination fee of the lesser of six months of the base monthly rent or the base monthly rent times the number of months remaining in the initial term.