The Company’s office space and the land and buildings related to the Drive Thru and Bad Daddy’s restaurant facilities are classified as operating leases and expire at various dates over the next 16 years. Some leases contain escalation clauses over the lives of the leases. Most of the leases contain one to three five-year renewal options at the end of the initial term. Certain leases include provisions for additional contingent rent payments if sales volumes exceed specified levels. The Company paid $71,000 and $18,000 in contingent rentals for fiscal 2021 and fiscal 2020, respectively.

The Company determines if a contract contains a lease at inception. The Company's material long-term operating lease agreements are for the land and buildings for our restaurants as well as our corporate office. The initial lease terms for our restaurants range from 10 years to 20 years, most of which at lease inception included renewal options of 10 to 15 years. The lease term is generally the minimum of the noncancelable period or the lease term including renewal options which are reasonably certain of being exercised up to a term of approximately 20 years.

Some of the leases provide for base rent, plus additional rent based on gross sales, as defined in each lease agreement. The Company is also generally obligated to pay certain real estate taxes, insurance and common area maintenance charges, and various other expenses related to properties, which are expensed as incurred.

F-15

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Components of operating lease costs in the consolidated statements of operations for the fiscal years ended September 28, 2021 and September 29, 2020 are as follows (in thousands):

	Classification	Fiscal 2021			Fiscal 2020
Operating lease cost	Occupancy, Other restaurant operating costs, preopening costs and General and administrative expenses, net	$	7,154		$	7,204
Variable lease cost	Occupancy		71			80
Sublease income	Occupancy		(535	)		(500	)
Total lease expense		$	6,690		$	6,784

Components of lease assets and liabilities on the consolidated balance sheets as of September 28, 2021 and September 29, 2020 are as follows (in thousands):

	Classification	September 28, 2021		September 29, 2020
Right-of-use assets	Operating lease assets	$	45,737	$	49,252

Current lease liabilities	Operating lease liability	$	4,935	$	4,689
Non-current lease liabilities	Operating lease liability, less current portion		49,723		53,731
Total lease liabilities		$	54,658	$	58,420

Supplemental cash flow disclosures for the fiscal years ended September 28, 2021 and September 29, 2020 (in thousands):

	Fiscal 2021		Fiscal 2020
Cash paid for operating lease liabilities	$	7,028	$	6,840

Non-cash operating lease assets obtained in exchange for operating lease liabilities	$	324	$	2,390

Weighted average lease term and discount rate are as follows:

	September 28, 2021			September 29, 2020
Weighted average remaining lease term (in years)		9.5			10.4

Weighted average discount rate		5.0	%		5.0	%

Future minimum rent payments for our operating leases for each of the next five years as of September 28, 2021 are as follows (in thousands):

Fiscal year ending:	Total
2022	$	7,553
2023		7,625
2024		7,485
2025		7,590
2026		7,041
Thereafter		32,061
Total minimum lease payments		69,355
Less: imputed interest		(14,697	)
Present value of lease liabilities	$	54,658

The above future minimum rental amounts exclude the amortization of deferred lease incentives, renewal options that are not reasonably assured of renewal, and contingent rent. The Company generally has escalating rents over the term of the leases and records rent expense on a straight-line basis.