Empery Digital Inc. Leases Disclosure

NOTE 17 – LEASES

 

The components of lease cost for operating leases for the year ended December 31, 2025 and 2024 is as follows:

Schedule of lease cost for operating leases
		2025				2024
Lease Cost
Operating lease cost		$	471,230			$	468,996
Short-term lease cost			111,473				169,051
Total lease cost		$	582,703			$	638,047

  

Supplemental cash flow information related to leases for the year ended December 31, 2025 and 2024, is as follows:

Schedule of supplemental cash flow information related to leases
		2025				2024
Other Lease Information
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases		$	466,036			$	399,609
Amortization of right-of-use assets		$	417,330			$	396,979

 

The following table summarizes the lease-related assets and liabilities recorded on the balance sheet at December 31, 2025 and December 31, 2024:

Schedule of lease-related assets and liabilities
		2025				2024
Lease Position
Operating Leases:
Operating lease right-of-use assets		$	778,235			$	739,234
Right-of-use liabilities operating leases short-term			322,103				443,950
Right-of-use liabilities operating leases long-term			471,683				331,222
Total operating lease liabilities		$	793,786			$	775,172

 

The Company utilizes the incremental borrowing rate in determining the present value of lease payments unless the implicit rate is readily determinable. The Company recognized an initial right-of-use asset and lease liability of $563,660 for leases entered into during the year ended December 31, 2025.

Schedule of present value lease payments
Lease Term and Discount Rate		December 31, 2025
Weighted-average remaining lease term (years):
Operating leases			4.1
Weighted-average discount rate:
Operating leases			7.51%

 

The following table provides the maturities of lease liabilities at December 31, 2025:

Schedule of maturities of lease liabilities
		Operating
		Leases
2026			369,599
2027			110,691
2028			110,691
2029			121,232
2030			131,772
2031			98,829
Total future undiscounted lease payments			942,814
Less: Interest			(149,028	)
Present value of lease liabilities		$	793,786

 

As discussed in Note 12, in August 2025 the Company entered into an assignment and assumption of a lease agreement with EAM whereby the Company agreed to assume half of the lease obligation of the New York City office lease of EAM. The Company recognized a right-of-use asset and liability of $563,660 for this lease, which includes the extension period discussed in Note 12.

 

In September 2025, the Company abandoned a leased facility in Round Rock, Texas. Upon abandonment of the facility the Company wrote off the remaining right of use asset of $107,329. On December 30, 2025, the Company and the landlord of this facility entered into a termination agreement and the Company is no longer obligated to make any lease payment on this facility and wrote off the remaining right of use liability of $79,010. As part of the termination agreement the Company agreed to forfeit $44,225 of its security deposit to the landlord and the remaining $55,390 of the security deposit will be returned to the Company in 2026. For the year ended December 31, 2025, the Company recognized a net loss of $72,544 associated with this terminated lease.