Big Digital Energy, Inc. Leases Disclosure
NOTE 7 – LEASES
The Company’s operating leases are for digital asset mining sites and its finance leases which are primarily related to plant and equipment.
The Company leases 8-acres of land in Midland Pennsylvania under a lease which was amended and renewed in September 2024 for an additional thirty-six months. The lease can be renewed three more times for an additional nine years in total.
Effective May 24, 2023, Mawson Bellefonte LLC entered into a lease agreement for a 9,918 square foot developed mining facility in Bellefonte, PA, which was amended and renewed in November 2025. The amended term of the lease is for seven years and seven months.
Effective May 1, 2023, Mawson Ohio LLC took an assignment of a lease agreement for approximately 64,600 square feet for an undeveloped site in Corning, Ohio. The term of the lease is five years, with an option to extend for five years.
Other than the foregoing leases, the Company does not lease any other material assets. The Company believes that these facilities are suitable and adequate for its operations as currently conducted and foreseen.
The Company’s lease costs recognized in the consolidated statements of operations and comprehensive loss consist of the following:
| For the Years Ended | ||||||||
| December 31, | ||||||||
| 2025 | 2024 | |||||||
| Operating lease charges (1) | $ | 1,748,343 | $ | 1,771,150 | ||||
| Finance lease charges: | ||||||||
| Amortization of right-of-use assets | 411,188 | 253,432 | ||||||
| Interest on lease obligations | 54,660 | 56,086 | ||||||
| (1) | Included in Selling, General & Administrative Expenses. |
The following is a schedule of the Company’s lease liabilities by contractual maturity as of December 31, 2025:
| Operating Leases | Finance Leases | |||||||
| 2026 | $ | 1,734,606 | $ | 185,016 | ||||
| 2027 | 1,425,075 | |||||||
| 2028 | 160,685 | |||||||
| 2029 | 167,112 | |||||||
| 2030 | 173,796 | |||||||
| Total undiscounted lease obligations | 3,661,274 | 185,016 | ||||||
| Less: imputed interest | (540,025 | ) | (8,309 | ) | ||||
| Total present value of lease liabilities | 3,121,249 | 176,707 | ||||||
| Less: current portion of lease liabilities | 1,402,826 | 176,707 | ||||||
| Non-current lease liabilities | $ | 1,718,423 | $ | |||||
Other lease information as of December 31, 2025:
| Operating Leases | Finance Leases | |||||||
| Operating cash out flows from leases | $ | 1,678,678 | $ | 444,426 | ||||
| Weighted-average remaining lease term (years) | 2.34 | 0.35 | ||||||
| Weighted-average discount rate (%) | 9.1 | % | 13.6 | % | ||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 31, 2026 | Showing above |
| 2024 | Mar 28, 2025 | |
| 2023 | Apr 1, 2024 | |
| 2022 | Mar 23, 2023 | |
| 2021 | Mar 21, 2022 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.