Quarterly report [Sections 13 or 15(d)]

Note 19 - Leases

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Note 19 - Leases
6 Months Ended
May 31, 2025
Notes to Financial Statements  
Lessee, Operating Leases [Text Block]

19.

LEASES

 

Operating Leases

The Company has operating leases for real estate in the United States and South Africa and does not have any finance leases.

 

In 2019, the Company entered into a real estate lease for office space in Andover, Massachusetts.  In August 2021, the lease was amended to include additional space and extend the term of the existing space by one year. The new lease expiration date is February 29, 2028.  

 

The Company leases office and warehouse space in South Africa. The Company has exercised its right to extend the lease for an additional year. The lease, which was originally set to expire in December 2024, was extended to December 2025.

 

The Company leased warehouse and manufacturing space in Fort Wayne, Indiana. The lease was to expire on July 31, 2025. Commencing in August 2022, the Company sub-leased the former Fort Wayne facility.  The amount received from the sub-lease was immaterial.  In March 2024, the Company terminated the lease and sublease. 

 

Commencing in July 2024, the Company entered into a new operating lease for warehouse and retail office space located in Fort Wayne, Indiana. The lease term is for five years, commencing on July 15, 2024 and expiring on July 14, 2029. As of May 31, 2025, the total right-of-use asset amounting to $0.2 million and the corresponding lease liability of $0.3 million are reflected in the Company's financial statements.

 

The Company also leases office space in Las Vegas, Nevada, which expires on January 31, 2027The base rent is less than $0.1 million per month.

 

Commencing in August 2024, the Company entered into a new operating lease for retail office space located in Salem, New Hampshire. The lease term is for five years, commencing on August 22, 2024 and expiring on August 21, 2029As of May 31, 2025, the total right-of-use asset amounting to $0.1 million and the corresponding lease liability of $0.1 million are reflected in the Company's financial statements.

 

Commencing in August 2024, the Company entered into a new operating lease for retail office space located in Scottsdale, Arizona. The lease term is for eight years, commencing on August 27, 2024 and expiring on July 31, 2032As of May 31, 2025, the total right-of-use asset amounting to $0.6 million and the corresponding lease liability of $0.7 million are reflected in the Company's financial statements.

 

Commencing in November 2024, the Company entered into a new operating lease for retail office space located in Franklin, Tennessee. The lease term is for five and a half years, commencing on November 1, 2024 and expiring on April 30, 2030. As of May 31, 2025, the total right-of-use asset amounting to $0.2 million and the corresponding lease liability of $0.3 million are reflected in the Company's consolidated financial statements.

 

Commencing in April 2025, the Company entered into another operating lease for office space located in Las Vegas, Nevada. The lease term is for three years, commencing on April 1, 2025 and expiring on April 30, 2028. As of May 31, 2025, the total right-of-use asset amounting to $0.2 million and the corresponding lease liability of $0.2 million are reflected in the Company's consolidated financial statements.

 

Certain of the Company’s leases contain options to renew and extend lease terms and options to terminate leases early. Reflected in the right-of-use asset and lease liability on the Company’s balance sheets are the periods provided by renewal and extension options that the Company is reasonably certain to exercise, as well as the periods provided by termination options that the Company is reasonably certain to not exercise.

 

For the three and six months ended May 31, 2025, the elements of lease expense were as follows (in thousands):

 

   

Three Months Ended

   

Six Months Ended

 
   

May 31, 2025

   

May 31, 2025

 

Lease Cost:

               

Operating lease cost

  $ 190     $ 370  

Short-term lease cost

    20       39  

Total lease cost

  $ 210     $ 409  
                 

Other Information:

               

Cash paid for amounts included in the measurement of operating lease liabilities

  $ 135     $ 240  

Operating lease liabilities arising from obtaining right-of-use assets

  $ 178     $ 178  
                 

Operating Leases:

               

Weighted-average remaining lease term (in years)

    4.3       4.3  

Weighted-average discount rate

    7.9 %     7.9 %

 

Future lease payments under non-cancelable operating leases as of May 31, 2025 are as follows (in thousands):

 

Fiscal Year Ending November 30,

       

2025 (six months)

  $ 410  

2026

    840  

2027

    738  

2028

    386  

2029

    266  

Thereafter

    387  

Total lease payments

    3,027  

Less: imputed interest

    440  

Present value of operating lease liabilities

  $ 2,587  

Operating lease liabilities, current

  $ 652  

Operating lease liabilities, non-current

  $ 1,935