Leases

9 Months Ended

Dec. 31, 2022

All leases in which the Company is the lessee are comprised of corporate office space and tower space. The Company is obligated under certain lease agreements for office space with lease terms expiring on various dates from October 31, 2023 through June 30, 2027, which includes lease extensions for its corporate headquarters ranging from three to ten years. The Company entered into multiple lease agreements for tower space with lease expiration dates ranging from January 15, 2023 to August 31, 2029.

All of the Company’s leases are classified as operating leases, and as such, were previously not recognized on the Company’s Consolidated Balance Sheet. With the adoption of ASC 842 Leases, operating lease agreements are required to be recognized on the Consolidated Balance Sheet as right of use (“ROU”) assets and corresponding lease liabilities.

ROU assets include any prepaid lease payments and exclude any lease incentives and initial direct costs incurred. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The lease terms may include options to extend or terminate the lease if it is reasonably certain that the Company will exercise that option.

Weighted-average remaining lease term and incremental borrowing rate for the Company’s operating leases are as follows:


	Nine months ended December 31,
	2022	2021
Weighted average term - operating lease liabilities	3.01 years	3.78 years
Weighted average incremental borrowing rate - operating lease liabilities	12%	13%

Rent expense amounted to approximately $0.5 million and $1.4 million, respectively, for the three and nine months ended December 31, 2022, which is included in general and administrative expenses in the Consolidated Statement of Operations. Rent expense amounted to approximately $0.5 million and $1.5 million, respectively, for the three and nine months ended December 31, 2021, which is included in general and administrative expenses in the Consolidated Statement of Operations.

The following table presents net lease cost for the three and nine months ended December 31, 2022 and 2021 (in thousands):


	Three months ended December 31,				Nine months ended December 31,
	2022		2021		2022		2021
Lease cost
Operating lease cost (cost resulting from lease payments)	$	461	$	485	$	1,355	$	1,493
Short term lease cost	—		3		7		13

Net lease cost	$	461	$	488	$	1,362	$	1,506

The following table presents supplemental cash flow and non-cash activity information for the nine months ended December 31, 2022 and 2021 (in thousands):


	Nine months ended December 31,
	2022		2021
Cash paid activity:
Operating lease - operating cash flows (fixed payments)	$	1,634	$	1,719
Operating lease - operating cash flows (liability reduction)	$	747	$	1,087
Non-cash activity:
Right of use assets obtained in exchange for new operating lease liabilities	$	165	$	78

The following table presents supplemental balance sheet information as of December 31, 2022 and March 31, 2022 (in thousands):


	December 31, 2022		March 31, 2022
Non-current assets - right of use assets, net	$	3,567	$	4,047
Current liabilities - operating lease liabilities	$	1,749	$	1,512
Non-current liabilities - operating lease liabilities	$	3,193	$	4,177

Future minimum payments under non-cancelable leases for office and tower spaces (exclusive of real estate tax, utilities, maintenance and other costs borne by the Company) for the remaining terms of the leases following the nine months ended December 31, 2022, are as follows (in thousands):


Fiscal Year	Operating Leases
2023 (excluding the nine months ended December 31, 2022)	$	567
2024	2,128
2025	1,661
2026	902
2027	497
After 2027	174
Total future minimum lease payments	5,929
Amount representing interest	(987)
Present value of net future minimum lease payments	$	4,942