Leases

9 Months Ended

Jun. 30, 2023

Note 9 – Leases

The Company leases certain equipment under

non-cancelable

operating leases. Future minimum rental payments under these leases at June 30, 2023 were immaterial.

On August 28, 2020, the Company entered into a three-year operating lease for property related to the manufacturing and warehousing of the paver line. The lease term is for the period from September 1, 2020 through August 31, 2023. In accordance with ASU

2016-02,

the Company recorded a ROU asset totaling $970,000 and related lease liabilities at inception. In March 2023, the Company extended the lease term through August 31, 2024. In accordance with ASU

2016-02,

the Company recorded a ROU asset totaling $352,000 and related lease liabilities upon extension.

On October 9, 2020, the Company entered into an operating lease for additional warehousing space. The original lease term was for one year beginning November 2020 with automatic

one-year

renewals. In accordance with ASU

2016-02,

the Company recorded a ROU asset totaling $254,000 and related lease liabilities at inception. An additional $39,000 was recorded as a ROU asset and related lease liability in October 2021 to reflect the impact of the lease renewal. In March 2022, the ROU asset and related liability was reduced by $39,000 to reflect the impact of a reduction in the square footage being leased.

For the quarter and nine months ended June 30, 2023, operating lease costs were $101,000 and $315,000, respectively, and cash payments related to these operating leases were $101,000 and $344,000, respectively. For the quarter and nine months ended June 30, 2022, operating lease costs were $99,000 and $301,000, respectively, and cash payments related to these operating leases were $104,000 and $320,000, respectively.

Other information concerning the Company’s operating lease accounted for under ASC 842 guidelines as of June 30, 2023 and September 30, 2022, is as follows:


	June 30, 2023			September 30, 2022
Operating lease ROU asset included in other long-term assets	$	436,000		$	396,000
Current operating lease liability	$	376,000		$	390,000
Non-current operating lease liability	$	60,000		$	6,000
Weighted average remaining lease term (in years)		0.50			1.00
Weighted average discount rate used in calculating ROU asset		4.3	%		4.0	%

Future annual minimum lease payments as of June 30, 2023 are as follows:


Fiscal Year	Annual Lease Payments
2023 (remaining 3 months)	$	114,000
2024		330,000

Total		444,000
Less interest		(8,000	)

Present value of lease liabilities	$	436,000