Leases

9 Months Ended

Jun. 30, 2021

We have leases for facilities and office equipment. Our lease liabilities are recognized as the present value of the future minimum lease payments over the lease term. Our right-of-use assets are recognized as the present value of the future minimum lease payments over the lease term plus lease payments made to the lessor before or at lease commencement less unamortized lease incentives and the balance remaining in deferred rent liability under ASC 840. Our lease payments consist of fixed and in-substance fixed amounts attributable to the use of the underlying asset over the lease term. Variable lease payments that do not depend on an index rate or are not in-substance fixed payments are excluded in the measurement of right-of-use assets and lease liabilities and are expensed in the period incurred. The incremental borrowing rate on our credit facility was used in determining the present value of future minimum lease payments. Some of our lease agreements include options to extend the lease term or terminate the lease. These options are accounted for in our right-of-use assets and lease liabilities when it is reasonably certain that the Company will extend the lease term or terminate the lease. The Company does not have any finance leases. As of June 30, 2021, operating leases for facilities and equipment have remaining lease terms of 1.5 to 9.8 years.

The following table summarizes lease balances in our consolidated balance sheets at June 30, 2021 and September 30, 2020 (in thousands):


	June 30,		September 30,
	2021		2020
Operating lease right-of-use assets	$	20,481	$	22,427

Operating lease liabilities, current	$	2,186	$	2,045
Operating lease liabilities - long-term	19,944		21,620
Total operating lease liabilities	$	22,130	$	23,665

The Company subleases a portion of one of its leased facilities. The sublease is classified as an operating lease with respect to the underlying asset. The sublease was assumed from the acquisition of Social & Scientific Systems, Inc. ("S3") in fiscal 2019. The sublease term is 5 years with two additional 1-year term extension options.

For the three and nine months ended June 30, 2021 and June 30, 2020, total lease costs for our operating leases are as follows (in thousands):



	Three Months Ended				Nine Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Operating	$	903	$	834	$	2,763	$	3,399
Short-term	18		30		88		133
Variable	40		28		70		51
Sublease income	(46)		(70)		(233)		(198)
Total lease costs	$	915	$	822	$	2,688	$	3,385

The Company's future minimum lease payments as of June 30, 2021 are as follows:


For the Fiscal Year Ending September 30,	(in thousands)
2021 (remaining)	$	823
2022	3,501
2023	3,391
2024	3,251
2025	3,092
Thereafter	14,684
Total future lease payments	28,742
Less: imputed interest	(6,612)
Present value of future minimum lease payments	22,130
Less: current portion of operating lease liabilities	(2,186)
Long-term operating lease liabilities	$	19,944

Other information related to our leases are as follows:


	June 30, 2021
Weighted-average remaining lease term	8.5 years
Weighted-average discount rate	6.00	%


		Three Months Ended				Nine Months Ended
		June 30,				June 30,
(in thousands)	Ref	2021		2020		2021		2020
Cash paid for amounts included in the measurement of lease liabilities		$	815	$	336	$	2,483	$	2,803
New lease liabilities, net of new right-of-use assets	(a)	$	—	$	—	$	—	$	245
Lease liabilities arising from obtaining right-of-use-assets	(a)	$	—	$	—	$	—	$	7,179

Ref (a): Changes resulted from an amended and remeasured operating lease