The Company has obligations as a lessee for floorspace. Generally, these lease arrangements meet the short-term lease criteria when the floorspace leases are cancellable by the Company upon notice of 30 days or less. Accordingly, for the leases that are cancellable, the Company has elected and applied the practical expedient that allows the Company to recognize short-term lease payments on a straight-line basis over the lease term on the Consolidated Statements of (Loss) Income and Comprehensive (Loss) Income. For those floorspace leases that have a noncancellable term greater than 12 months, the Company records ROU assets and lease liabilities and presents them as operating leases. The Company recognized right of use assets and a lease liability of $2.2 million for the three and nine months ended September 30, 2024 as a result of the non-cash transaction related to floorspace operating leases.

The Company has obligations as a lessee for office space under a noncancellable lease arrangement that expires in May 2025, with options to renew up to five years. Payments due under the lease contracts include mainly fixed payments. The lease for the office space is classified as an operating lease in accordance with Topic 842.

The Company has obligations as a lessee for BTM kiosks. The leases for the BTM kiosks are classified as finance leases in accordance with Topic 842 that expire on various dates through June 30, 2026. The BTM kiosk lease agreements are for two or three year terms and include various options to either renew the lease, purchase the kiosks or exercise a bargain option to purchase the kiosk at the end of the term. Certain finance leases are personally guaranteed by the CEO and contain guarantees for return of equipment by the CEO.

During the nine months ended September 30, 2023, the Company terminated three existing lease arrangement with a lessor and simultaneously entered into a new lease arrangements with a new lessor for 2,050 BTMs. Under these agreements, the new lessor agreed to purchase the BTM’s from the original lessor. Upon the termination of the original agreements, the Company removed the remaining right-of-use asset and the finance lease liability of $7.5 million and $5.7 million respectively and recognized a loss of $1.7 million recorded in other (expense) income in the consolidated Statement of Income (Loss) and Comprehensive Income (Loss). The new leases commenced on March 31, 2023, June 30, 2023 or September 30, 2023 and have three year noncancellable periods. Total fixed payments due on an undiscounted basis over the three year noncancellable period of the leases are $7.1 million. The Company will acquire the assets for a bargain purchase price of $1 at the end of the term. Due to the bargain purchase option, the Company classified the new leases as finance leases. The Company recognized a finance lease liability of $5.7 million discounted at an interest rate implicit in the lease and a corresponding right-of-use asset of $5.7 million.

During the nine months ended September 30, 2024 the Company entered into lease agreements for the lease of 1,186 new BTMs. The leases have noncancellable lease terms ranging from 24 months to 36 months. The Company will acquire the assets for a bargain purchase price of $1 at the end of their terms. Due to the bargain purchase option, the Company classified the new leases as a finance

lease. The Company recognized right of use assets and a lease liability of $7.7 million for the nine months ended September 30, 2024 as a result of the non-cash transaction related to the finance leases.

The components of the lease expense are as follows (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Finance lease expense:
Amortization of right-of-use-assets	$	884	$	1,861	$	3,469	$	6,375
Interest on lease liabilities		310		738		1,049		3,410
Total finance lease expense		1,194		2,599		4,518		9,785
Operating lease expense		299		103		660		212
Short-term lease expense		9,730		7,731		27,125		25,513
Total lease expense	$	11,223	$	10,433	$	32,303	$	35,510


	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
Other information:
Operating cash flows used for finance leases	$	(320	)	$	(738	)	$	(1,088	)	$	(3,410	)
Operating cash flows used for operating leases	$	(340	)	$	(117	)	$	(749	)	$	(231	)
Financing cash flows used for finance leases	$	(2,049	)	$	(2,108	)	$	(6,242	)	$	(8,809	)



	September 30, 2024	December 31, 2023
Weighted-average remaining lease term - finance leases	1.8 years	1.6 years
Weighted-average remaining lease term - operating leases	3.2 years	2.3 years
Weighted-average discount rate - finance leases	18.4%	17.9%
Weighted-average discount rate - operating leases	16.9%	16.6%

Maturities of the lease liability under the noncancellable operating leases as of September 30, 2024 are as follows (in thousands):


	Operating Leases
Remainder of 2024	$	340
2025		1,225
2026		1,125
2027		590
2028		343
Thereafter		59
Total undiscounted lease payments		3,682
Less: imputed interest		(812	)
Total operating lease liability		2,870
Less: operating lease liabilities, current		(887	)
Operating lease liabilities, net of current portion	$	1,983

Maturities of the lease liability under the noncancellable finance leases as of September 30, 2024 are as follows (in thousands):


	Finance Leases
Remainder of 2024	$	1,676
2025		4,144
2026		1,753
2027		384
Total undiscounted lease payments		7,957
Less: imputed interest		(1,170	)
Total finance lease liability		6,787
Less: current installments of obligations under finance leases		(3,931	)
Obligations under finance leases, excluding current installments	$	2,856