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Leases

3 Months Ended

Oct. 31, 2021

Note 4—Leases

The Company’s leases primarily consist of operating leases for office space. These leases have remaining terms from one to six years. net2phone-UCaaS also has operating leases for office equipment. Certain of these leases contain renewal options that may be exercised and/or options to terminate the lease. The Company has concluded that it is not reasonably certain that it would exercise the options to extend or terminate the leases.

net2phone-UCaaS is the lessee in equipment leases that are classified as finance leases. The assets and liabilities related to these finance leases are not material to the Company’s consolidated balance sheets.

The Company leases office and parking space from Rafael Holdings, Inc. (“Rafael”) in a building and parking garage located at 520 Broad Street, Newark, New Jersey. The Company also leases office space in Israel from Rafael. Howard S. Jonas, the Chairman of the Company’s Board of Directors, is also the Chairman of the Board of Directors of Rafael. The Newark lease expires in April 2025 and the Israel lease expires in July 2025. In each of the three months ended October 31, 2021 and 2020, the Company incurred lease costs of $0.5 million in connection with the Rafael leases, which is included in operating lease cost in the table below.

Supplemental disclosures related to the Company’s operating leases were as follows:

	2021		2020
	Three Months Ended October 31,
	2021		2020
	(in thousands)
Operating lease cost	$	700	$	729
Short-term lease cost		347		65
Total lease cost	$	1,047	$	794
Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases	$	695	$	710

	October 31, 2021			July 31, 2021
Weighted-average remaining lease term-operating leases		3.4 years			3.4 years
Weighted-average discount rate-operating leases		2.9	%		2.9	%

On September 13, 2021, the Company entered into a new lease with an aggregate operating lease liability of $0.7 million. The Company’s aggregate operating lease liability was as follows:

	October 31, 2021		July 31, 2021
		(in thousands)
Operating lease liabilities included in “Other current liabilities”	$	2,500	$	2,456
Operating lease liabilities included in noncurrent liabilities		5,533		5,473
Total	$	8,033	$	7,929

Future minimum maturities of operating lease liabilities were as follows (in thousands):

Twelve-month period ending October 31:
2022	$	2,698
2023		2,406
2024		1,967
2025		1,095
2026		139
Thereafter		154
Total lease payments		8,459
Less imputed interest		(426	)
Total operating lease liabilities	$	8,033