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Leases
9 Months Ended
Nov. 30, 2024
Leases [Abstract]  
LEASES

NOTE 7 – LEASES

 

Our administrative and production operations, including warehousing, are housed in an approximately 18,000 square foot facility in Lake Forest, California. The Lake Forest lease is for 66-months effective February 2021 through November 30, 2026. The initial monthly base rental rate was approximately $22 per month and escalates 3% each year to approximately $26 per month in 2026. The lease liability was determined by discounting the future lease payments under the lease terms using a 10% per annum discount rate to arrive at the current lease liability.

 

Operating lease right-of-use (“ROU”) assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Generally, the implicit rate of interest in arrangements is not readily determinable and the Company utilizes its incremental borrowing rate in determining the present value of lease payments. The operating lease ROU asset includes any lease payments made and excludes lease incentives.

 

The components of lease expense and supplemental cash flow information related to leases for the period are as follows:

 

(amounts in thousands)  November 30,
2024
   November 30,
2023
 
Lease Cost        
Operating lease cost (included in general and administration in the Company’s statement of operations)  $211   $209 
           
Other Information          
Cash paid for amounts included in the measurement of lease liabilities  $141   $212 
Weighted average remaining lease term – operating leases (in years)   1.75    2.75 
Average discount rate – operating leases   10.0%   10.0%

 

The supplemental balance sheet information related to leases for the period is as follows:

 

   At
November 30,
2024
 
Operating leases    
Long-term right-of-use assets  $457 
      
Short-term operating lease liabilities  $263 
Long-term operating lease liabilities   221 
Total operating lease liabilities  $484 

 

Maturities of the Company’s lease liability is as follows:

 

   Operating
Lease
 
Years Ending February 28:    
2025 (3 months)  $72 
2026   299 
2027   155 
Total lease payments   526 
Less: imputed interest/present value discount   (42)
Present value of lease liability  $484