Leases

9 Months Ended

Mar. 31, 2022

Commitments and Contingencies Disclosure [Abstract]

Leases

Leases Operating lease cost amounted to $0.5 million and $2.1 million for the three and nine months period ended March 31, 2022 and $0.6 million and $1.8 million for the three and nine months period ended December 31, 2021. As of March 31, 2022, the Company’s right-of-use assets "ROU", lease obligations and remaining cash commitment on these leases (in thousands):

	Right-of-Use Assets	Operating Lease Obligations	Remaining Cash Commitment
Operating leases	$5,606	$5,766	$6,925

In March, the Company adopted a restructuring plan to close down Starrett Japan and Singapore operating units and continue to service that region out of Brazil and China with company agents servicing those countries. In the June quarter the Company expects to reduce its ROU asset and liabilities $0.1 million.

In September 2021, the Company entered into a six year lease in China for 100,682 square feet and recorded a right-of-use asset for $2.6 million. In July 2021, Starrett UK leased space to another company for annual rent of $0.2 million and incremental applicable service charges. The lease is a 20 year agreement with a contract review in 2026. The fees are recorded in Other Income in the Company's Consolidated Statement of Operations.

The Company has other operating lease agreements with commitments of less than one year or that are not significant. The Company elected the practical expedient option and as such, these lease payments are expensed as incurred. The Company’s weighted average discount rate and remaining term on lease liabilities is approximately 9.0% and 4.4 years. As of March 31, 2022, the Company’s financing leases are de minimis. The foreign exchange impact affecting the operating leases was de minimis in the March quarter and $0.1 million for the nine months ending March 31, 2022.

The Company entered into $0.2 million and $2.8 million in new operating lease commitments.

At March 31, 2022, the Company had the following fiscal year minimum operating lease commitments (in thousands)

Nine months ended March 31, 2022	Operating Lease Commitments
2022 (Remainder of year)	$552
2023	1,813
2024	1,541
2025	1,143
2026	1,050
Thereafter	826
Subtotal	$6,925
Imputed interest	(1,159)
Total	5,766