Note

- Leases

Operating Leases.

August 2020,

the Company entered into a new lease in Abu Dhabi for land upon which the Company intends to build a facility. The annual payments are initially expected to be approximately

1.2

million Dirhams (approximately

$0.3

million at

October 31, 2020),

inclusive of rent and common charges, with escalation clauses in the agreement. Rent payments are deferred until

August 2022.

The lease expires in

August 2050.

Finance Leases.

2019,

the Company obtained

two

finance leases for a total of CAD

1.1

million (approximately

$0.8

million at the prevailing exchange rates on the transaction dates) to finance vehicle equipment. The interest rates for these finance leases were

8.0%

per annum with monthly principal and interest payments of less than

$0.1

million. These leases mature in

August 2023.

2017,

the Company obtained

three

finance leases for a total of CAD

1.1

million (approximately

$0.8

million at the prevailing exchange rates on the transaction dates) to finance vehicle equipment. The interest rates for these finance leases range from

4.0%

7.8%

per annum with monthly principal and interest payments of less than

$0.1

million. These leases mature between

April

2021

September

2022.

August

2016,

the Company obtained a finance lease for

0.6

million Indian Rupees (approximately

thousand at the prevailing exchange rate on the transaction date) to finance vehicle equipment. The interest rate for this finance lease was

15.6%

per annum with monthly principal and interest payments of less than

thousand. This lease expired in

July

2019.

The Company has several significant operating lease agreements, with lease terms of

one

years, which consist of real estate, vehicles and office equipment leases. These leases do

not

require any contingent rental payments, impose any financial restrictions or contain any residual value guarantees. Certain of the Company's leases include renewal options and escalation clauses; renewal options have

not

been included in the calculation of the lease liabilities and right-of-use ("ROU") assets as the Company is

not

reasonably certain to exercise the options. Variable expenses generally represent the Company's share of the landlord's operating expenses. The Company does

not

have any arrangements where it acts as a lessor, other than

one

sub-lease arrangement.

October 31, 2020

, the Company had total operating lease liabilities of

$14.9

million and total operating ROU assets of

$13.8

million, which are reflected in the consolidated balance sheet. At

October 31, 2020

, the Company also had total finance lease liabilities of $

0.8

million included in current maturities of long-term debt and long-term debt less current maturities, and total finance ROU assets of $

1.0

million which were included in property plant and equipment, net of accumulated depreciation in the consolidated balance sheet.

Supplemental balance sheet information related to leases is as follows:

Operating and Finance leases:	October 31, 2020			January 31, 2020
Finance leases assets:
Property and Equipment - gross	$	1,683		$	1,696
Accumulated depreciation and amortization		(700	)		(551	)
Property and Equipment - net	$	983		$	1,145

Finance lease liabilities:
Finance lease liability short-term	$	333		$	417
Finance lease liability long-term		446			677
Total finance lease liabilities	$	779		$	1,094

Operating lease assets:
Operating lease ROU assets	$	13,762		$	11,475

Operating lease liabilities:
Operating lease liability short-term	$	1,408		$	1,040
Operating lease liability long-term		13,477			11,214
Total operating lease liabilities	$	14,885		$	12,254

Total lease costs consist of the following:

Lease costs	Consolidated Statements of Operations Classification	Three Months Ended October 31, 2020			Three Months Ended October 31, 2019			Nine Months Ended October 31, 2020			Nine Months Ended October 31, 2019
Finance Lease Costs
Amortization of ROU assets	Cost of sales	$	50		$	53		$	151		$	155
Interest on lease liabilities	Interest expense		17			18			54			36
Operating lease costs	Cost of sales, SG&A expenses		682			579			1,904			1,716
Short-term lease costs (1)	Cost of sales, SG&A expenses		53			140			289			401
Sub-lease income	SG&A expenses		(21	)		(20	)		(61	)		(61	)
Total Lease costs		$	781		$	770		$	2,337		$	2,247

(

) Includes variable lease costs, which are immaterial

Supplemental cash flow information related to leases is as follows:

	Nine Months Ended October 31, 2020		Nine Months Ended October 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Financing cash flows from finance leases	$	310	$	185
Operating cash flows from finance leases		54		17
Operating cash flows from operating leases		1,713		1,127

	Nine Months Ended October 31, 2020
ROU Assets obtained in exchange for new lease obligations:
Finance leases liabilities	$	-
Operating leases liabilities		3,255

Weighted-average lease terms and discount rates are as follows:

	October 31, 2020
Weighted-average remaining lease terms (in years):
Finance leases		2.5
Operating leases		12.9

Weighted-average discount rates:
Finance leases		7.7	%
Operating leases		7.9	%

Maturities of lease liabilities as of

October 31, 2020

, are as follows:

Year:	Operating Leases			Finance Leases
For the three months ended January 31, 2021	$	630		$	121
For the year ended January 31, 2022		2,360			328
For the year ended January 31, 2023		2,406			266
For the year ended January 31, 2024		2,392			143
For the year ended January 31, 2025		1,662			-
For the year ended January 31, 2026		1,475			-

Thereafter		14,339			-
Total lease payments		25,264			858
Less: amount representing interest		(10,379	)		(79	)
Total lease liabilities at October 31, 2020	$	14,885		$	779

Rent expense on operating leases, which is recorded on straight-line basis, was

$0.7

million and

$0.7

million for the

three

months ended

October 31, 2020

and

2019

, and

$2.2

million and

$2.0

million for the

nine

months ended

October 31, 2020

and

2019

, respectively.