Leases

3 Months Ended

Feb. 28, 2022

Upon adoption of ASC 842, there were a number of optional practical expedients to apply in transition. The Company elected the package of practical expedients, which does not require the reassessment of prior conclusions about lease identification, lease classification and initial direct costs. Further, the Company elected the practical expedients to combine lease and non-lease components. Contracts may be comprised of lease components, non-lease components, and elements that are not components. Each lease component represents a lessee’s right to use an underlying asset in the contract if the lessee can benefit from the right-of-use of the asset either on its own or together with other readily available resources and if the right-of-use is neither highly dependent or highly interrelated with other rights-of-use. Non-lease components include items such as common area maintenance and utilities provided by the lessor. We also elected the practical expedient to not recognize right-of-use assets and lease liabilities for short-term leases. Leases with an initial term of 12 months or less are classified as short-term leases.

Consideration in the contract is comprised of any fixed payments and variable payments that depend on an index or rate. Payments in the Company's operating lease arrangements primarily consist of base office rent. In accordance with ASC 842, variable payments in an agreement that are not dependent on an index or rate are excluded from the calculation of ROU assets and lease liabilities. The Company makes variable payments on certain of its leases related to taxes, insurance, common area maintenance, and utilities, among other things.

The Company has operating leases for administrative, product development, and sales and marketing facilities, vehicles, and equipment under various non-cancelable lease agreements. The Company’s leases have remaining lease terms ranging from 1 year to 8 years. The Company’s lease terms may include options to extend or terminate the lease where it is reasonably certain that the Company will exercise those options. The Company considers several economic factors when making the determination as to whether the Company will exercise options to extend or terminate the lease, including but not limited to, the significance of leasehold improvements incurred in the office space, the difficulty in replacing the asset, underlying contractual obligations, or specific characteristics unique to a particular lease. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The components of operating lease cost for the three months ended February 28, 2022 and February 28, 2021 were as follows (in thousands):


	Three Months Ended		Three Months Ended
	February 28, 2022		February 28, 2021
Lease costs under long-term operating leases	$	1,764	$	2,135
Lease costs under short-term operating leases	14		15
Variable lease cost under short-term and long-term operating leases(1)	121		115
Total operating lease cost	$	1,899	$	2,265

(1) Lease costs that are not fixed at lease commencement.

The table below presents supplemental cash flow information related to leases during the three months ended February 28, 2022 and February 28, 2021 (in thousands):


	Three Months Ended
	February 28, 2022		February 28, 2021
Cash paid for leases	$	2,146	$	2,258
Right-of-use assets recognized for new leases and amendments (non-cash)	$	221	$	2,338

Weighted average remaining lease term in years and weighted average discount rate are as follows:


	February 28, 2022		November 30, 2021
Weighted average remaining lease term in years	3.93		4.15
Weighted average discount rate	2.6	%	2.6	%

Future payments under non-cancellable leases are as follows (in thousands):


	February 28, 2022
Remainder of 2022	$	6,635
2023	8,201
2024	7,817
2025	5,104
2026	1,832
Thereafter	1,314
Total lease payments	30,903
Less imputed interest(1)	(1,598)
Present value of lease liabilities	$	29,305

(1) Lease liabilities are measured at the present value of the remaining lease payments using a discount rate determined at lease commencement unless the discount rate is updated as a result of a lease reassessment event.