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LEASES
12 Months Ended
May 31, 2022
Leases [Abstract]  
LEASES LEASES
As of May 31, 2022, the Company had an operating lease liability and right of use asset for its office space that expires in October 2026. The Company also entered into several finance leases for equipment and land as of May 31, 2022. As of May 31, 2022, the Company did have one significant finance lease balance related to a land lease related to the Company's Garden City, TX facility.

The Company has elected the short-term lease exception and therefore, only recognized lease liabilities and right of use assets for leases longer than one year. The Company has also elected the practical expedient of not separating lease components from non-lease components for its real estate leases.

As of May 31, 2022, and May 31, 2021, the balance of the right of use assets were $6.4 million and $0, respectively, and the balance of the lease liability is $6.3 million and $0, respectively, for the Company’s office lease, land lease, and its leased equipment.

The calculation of these lease assets and liabilities includes minimum lease payments over the remaining lease term. Any variable lease payments are excluded from the amounts and are recognized in the period in which those obligations are incurred. Operating lease assets are included as right of use assets, net on the Balance Sheet. The current portion of lease liabilities are presented as current portion of lease liability on the Balance Sheet with the remainder included as long-term portion of lease liability on the Balance Sheet.
Balance sheet presentation of lease assets and liabilities, net is as follows:
Lease TypeConsolidated Balance Sheet PresentationMay 31, 2022
Operating Lease AssetsRight of use asset, net$1,110 
Finance lease assetsRight of use asset, net5,298 
Total lease assets$6,408 
Operating Lease liabilitiesCurrent portion of operating lease liability191 
Operating Lease liabilitiesLong-term portion of lease Liability936 
Total Operating Lease Liabilities$1,127 
Finance lease liabilitiesCurrent portion of lease liability$813 
Finance Lease liabilitiesLong-term portion of lease liability4,374 
Total Finance Lease Liabilities$5,187 
Total lease liabilities$6,314 
The Company presents lease costs under ASC 842 is as follows:
Lease TypeConsolidated Statements of Operations PresentationYear Ended
May 31, 2022
Operating lease expenseSelling, General and Administrative$328 
Finance lease expense:
Amortization of ROU assets related to revenue productionCost of Sales85 
Amortization of ROU assets not related to revenue productionDepreciation and Amortization Expense26 
Interest on finance leasesInterest Expense50 
Short-term lease expenseSelling, General and Administrative126 
Variable lease expenseSelling, General and Administrative— 
Total Lease Cost$615 
The following table represents the Company’s future minimum operating lease payments as of May 31, 2022, under ASC 842 (in thousands):
YearOperating LeasesFinance LeasesTotal
FY23$318 $1,189 $1,507 
FY24326 1,193 1,519 
FY25334 558 892 
FY26342 169 511 
FY27144 174 318 
Beyond— 87,324 87,324 
Total$1,464 $90,607 $92,071 
Present value of lease liabilities$1,127 $5,187 $6,314 
Less: Current portion of lease liability$191 $813 $1,004 
Long-term portion of lease liability$936 $4,374 $5,310 
Supplemental cash flow and other information related to leases is as follows:
Operating LeasesFinance Leases
Weighted-average years remaining4 years57 years
Weighted-average discount rate12.50 %7.98 %
Cash paid for the amounts included in the measurement of lease liabilities:
Operating cash flows$310 $50 
Financing cash flows$— $221 
LEASES LEASES
As of May 31, 2022, the Company had an operating lease liability and right of use asset for its office space that expires in October 2026. The Company also entered into several finance leases for equipment and land as of May 31, 2022. As of May 31, 2022, the Company did have one significant finance lease balance related to a land lease related to the Company's Garden City, TX facility.

The Company has elected the short-term lease exception and therefore, only recognized lease liabilities and right of use assets for leases longer than one year. The Company has also elected the practical expedient of not separating lease components from non-lease components for its real estate leases.

As of May 31, 2022, and May 31, 2021, the balance of the right of use assets were $6.4 million and $0, respectively, and the balance of the lease liability is $6.3 million and $0, respectively, for the Company’s office lease, land lease, and its leased equipment.

The calculation of these lease assets and liabilities includes minimum lease payments over the remaining lease term. Any variable lease payments are excluded from the amounts and are recognized in the period in which those obligations are incurred. Operating lease assets are included as right of use assets, net on the Balance Sheet. The current portion of lease liabilities are presented as current portion of lease liability on the Balance Sheet with the remainder included as long-term portion of lease liability on the Balance Sheet.
Balance sheet presentation of lease assets and liabilities, net is as follows:
Lease TypeConsolidated Balance Sheet PresentationMay 31, 2022
Operating Lease AssetsRight of use asset, net$1,110 
Finance lease assetsRight of use asset, net5,298 
Total lease assets$6,408 
Operating Lease liabilitiesCurrent portion of operating lease liability191 
Operating Lease liabilitiesLong-term portion of lease Liability936 
Total Operating Lease Liabilities$1,127 
Finance lease liabilitiesCurrent portion of lease liability$813 
Finance Lease liabilitiesLong-term portion of lease liability4,374 
Total Finance Lease Liabilities$5,187 
Total lease liabilities$6,314 
The Company presents lease costs under ASC 842 is as follows:
Lease TypeConsolidated Statements of Operations PresentationYear Ended
May 31, 2022
Operating lease expenseSelling, General and Administrative$328 
Finance lease expense:
Amortization of ROU assets related to revenue productionCost of Sales85 
Amortization of ROU assets not related to revenue productionDepreciation and Amortization Expense26 
Interest on finance leasesInterest Expense50 
Short-term lease expenseSelling, General and Administrative126 
Variable lease expenseSelling, General and Administrative— 
Total Lease Cost$615 
The following table represents the Company’s future minimum operating lease payments as of May 31, 2022, under ASC 842 (in thousands):
YearOperating LeasesFinance LeasesTotal
FY23$318 $1,189 $1,507 
FY24326 1,193 1,519 
FY25334 558 892 
FY26342 169 511 
FY27144 174 318 
Beyond— 87,324 87,324 
Total$1,464 $90,607 $92,071 
Present value of lease liabilities$1,127 $5,187 $6,314 
Less: Current portion of lease liability$191 $813 $1,004 
Long-term portion of lease liability$936 $4,374 $5,310 
Supplemental cash flow and other information related to leases is as follows:
Operating LeasesFinance Leases
Weighted-average years remaining4 years57 years
Weighted-average discount rate12.50 %7.98 %
Cash paid for the amounts included in the measurement of lease liabilities:
Operating cash flows$310 $50 
Financing cash flows$— $221