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LEASES | 6 Months Ended
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Jun. 30, 2022
LEASES |
NOTE 12 - LEASES | NOTE 12 — LEASES In determining our right-of-use assets and lease liabilities, we apply a discount rate to the minimum lease payments within each lease agreement. ASC 842 requires us to use the interest rate that a lessee would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. If we cannot readily determine the discount rate implicit in lease agreements, we utilize our incremental borrowing rate. The Company has seven operating leases as of June 30, 2022—five in the Dallas/Fort Worth Metroplex, one in Charleston, South Carolina and one in Chandler, Arizona. The lease for DGSE’s flagship store located at 13022 Preston Road, Dallas, Texas expires on January 31, 2027, with an option to extend the lease for an additional five years, at market rate as determined by the prevailing market rate for comparable space in comparable buildings in the vicinity. The lease for DGSE’s Grand Prairie, Texas location was renewed starting July 1, 2022, expiring June 30, 2027, with an option to extend the lease for an additional five years. The lease for DGSE’s Mt Pleasant, South Carolina location expires April 30, 2025, with no additional renewal options. The lease for DGSE’s Euless, Texas location expires June 30, 2025, with an option to extend the lease for an additional five years. The lease for ECHG’s Echo location on W. Belt Line Road, in Carrollton, Texas, expires January 31, 2026. The lease for ECHG’s Teladvance location, which also houses ITAD USA, on Realty Road in Carrollton, Texas expires January 31, 2027. The lease for ECHG’s Avail location in Chandler, Arizona expires May 31, 2025. All of the Company’s seven leases as of June 30, 2022 are triple net, for which it pays its proportionate share of common area maintenance, property taxes and property insurance. Leasing costs for the three months ended June 30, 2022 and 2021 was $659,860 and $588,896 respectively. Leasing costs for the six months ended June 30, 2022 and 2021 was $1,282,723 and $895,433, respectively, comprised of a combination of minimum lease payments and variable lease costs. As of June 30, 2022, the weighted average remaining lease term and weighted average discount rate for operating leases was 3.75 years and 4.4%, respectively. For the three months ended June 30, 2022 and 2021, the Company’s cash paid for operating lease liabilities was $650,606 and $588,026, respectively. For the six months ended June 30, 2022 and 2021, the Company’s cash paid for operating lease liabilities was $1,266,703 and $923,253, respectively. Future annual minimum lease payments as of June 30, 2022:
|  | Operating |
|  | Leases |
DGSE |  |  |
2022 (excluding the six months ending June 30, 2022) |  | $ | 267,938 |
2023 |  |  | 541,984 |
2024 |  |  | 552,414 |
2025 |  |  | 412,269 |
2026 and thereafter |  |  | 405,114 |
Total minimum lease payments |  |  | 2,179,719 |
Less imputed interest |  |  | (188,707 | )
DGSE Sub-Total |  |  | 1,991,012 |
ECHG |  |  |  |
2022 (excluding the six months ending June 30, 2022) |  |  | 661,506 |
2023 |  |  | 1,357,381 |
2024 |  |  | 1,396,129 |
2025 |  |  | 1,321,297 |
2026 and thereafter |  |  | 507,780 |
Total minimum lease payments |  |  | 5,244,093 |
Less imputed interest |  |  | (381,784 | )
ECHG Sub-Total |  |  | 4,862,309 |
Total |  |  | 6,853,321 |
Current portion |  |  | 1,631,270 |
|  | $ | 5,222,051 |

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- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI https://asc.fasb.org/subtopic&trid=77888251 + Details
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