XML 63 R17.htm IDEA: XBRL DOCUMENT

LEASES

3 Months Ended

Mar. 31, 2023

NOTE 11 – LEASES

Leases

The Company leases office space in the United States under operating lease agreements. The Company also entered into an arrangement with Applied Blockchain for the use of energized cryptocurrency mining facilities under which the Company pays for electricity per megawatt based on usage. The Company has determined that it has embedded operating leases at two of the facilities governed by this arrangement that commenced in January and March 2023, and has elected not to separate lease and non-lease components. Payments made for these two operating leases are therefore entirely variable and are based on usage of electricity, and the Company therefore does not record a right-of-use asset or lease liability associated with the leases. Variable lease cost during the three months ended March 31, 2023 are disclosed in the table below. Office space and mining facilities comprise the Company’s material underlying asset classes under operating lease agreements. The Company has no material finance leases.

As of March 31, 2023, the Company’s right-of-use (“ROU”) assets and total lease liabilities were $1,180 thousand and $1,245 thousand, respectively, for leases in the United States. As of December 31, 2022, the Company’s ROU assets and total lease liabilities were $1,276 thousand and $1,343 thousand, respectively. The Company has amortized right-of-use assets totaling $84 thousand and $110 thousand for the three months ended March 31, 2023, and year ended December 31, 2022, respectively.

Operating lease costs are recorded on a straight-line basis within operating expenses. The Company’s total lease expense is comprised of the following:

SCHEDULE OF COMPONENTS OF LEASE COST

(in thousands)	2023		2022
	For the Three Months Ended March 31,
(in thousands)	2023		2022
Operating leases
Operating lease cost	$	112	$	26
Operating lease expense		112		26
Short-term lease rent expense		9		7
Variable lease cost		2,773		—
Total rent expense	$	2,894	$	33

Additional information regarding the Company’s leasing activities as a lessee is as follows:

SUMMARY OF MINIMUM LEASE PAYMENTS

	For the Three Months Ended March 31,
(in thousands, except term and discount rate data)	2023			2022
Operating cash flows from operating leases	$	(2	)	$	17
Weighted-average remaining lease term – operating leases		3.5			4.7
Weighted-average discount rate – operating leases		5	%		5	%

SCHEDULE OF LEASE LIABILITY MATURITY


Year	Amount (in thousands)
2023 (remaining)	$	346
2024		362
2025		312
2026		241
2027		102
Thereafter		—
Total	$	1,363