3. Leases

6 Months Ended

Oct. 31, 2019

Lessee Disclosure [Abstract]

Leases

Note 3 – Leases

We currently lease office, manufacturing and warehouse space in four buildings under three separate non-cancellable operating lease agreements. All of our leased facilities are located in close proximity in Tustin, California, have original lease terms ranging from 7 to 12 years, contain two multi-year renewal options, and scheduled rent increases of 3% on either an annual or biennial basis. With respect to multi-year renewal options, a multi-year renewal option was used in determining the right-of-use asset and lease liability for two of our leases as we considered it reasonably certain that we would exercise such renewal options. In addition, two of our leases provide for periods of free rent, lessor improvements and tenant improvement allowances, of which, certain of these improvements have been classified as leasehold improvements and are being amortized over the shorter of the estimated useful life of the improvements or the remaining life of the lease. The operating lease right-of-use assets and liabilities on our October 31, 2019 condensed consolidated balance sheets primarily relate to these facility leases.

In September 2019, we entered into a lease amendment to terminate an operating lease for one of our non-manufacturing facilities that was primarily utilized for warehouse space. The lease termination was primarily driven by our efforts to reduce costs by leveraging available warehouse space in our other facilities, which in aggregate will save us approximately $1.3 over the next four years. In connection with the termination of this lease, we removed the corresponding operating lease right-of-use asset and liability balances from our balance sheet and recognized a loss of $0.4 million, which amount is included in loss on lease termination in the accompanying unaudited condensed consolidated statements of operations and comprehensive loss for the three and six months ended October 31, 2019. Additionally, the lease termination released $0.3 million of restricted cash that was pledged as collateral under a letter of credit required by the terminated lease.

Our operating lease expense for the three and six months ended October 31, 2019 was $0.9 million and $1.8 million, respectively, and is included in our accompanying unaudited condensed consolidated statements of operations and comprehensive loss as either cost of revenues or selling, general and administrative expense, depending on the leased asset. Cash paid for amounts included in the measurement of lease liabilities for the six months ended October 31, 2019 was $1.6 million and is included in net cash used in operating activities in our accompanying unaudited condensed consolidated statements of cash flows.

As of October 31, 2019, the maturities of our operating lease liabilities were as follows (in thousands):

Fiscal Year Ending April 30,	Total
2020 (remaining period)	$	1,539
2021		3,135
2022		3,159
2023		3,174
2024		3,249
Thereafter		22,020
Total lease payments	$	36,276
Less: imputed interest		(12,641	)
Total operating lease liabilities	$	23,635

The balance sheet classification of our operating lease liabilities was as follows (in thousands):

	October 31, 2019
Operating lease liabilities	$	1,241
Operating lease liabilities, less current portion		22,394
Total operating lease liabilities	$	23,635

As of October 31, 2019, the weighted average remaining lease term and weighted average discount rate of our operating leases was 10.8 years and 8.1%, respectively.