8. LEASES

6 Months Ended

Mar. 31, 2023

Leases [Abstract]

LEASES

8.LEASES

On October 1, 2019, the Company adopted the amendments to ASC 842, Leases, which requires lessees to recognize lease assets and liabilities arising from operating leases on the balance sheet. The Company adopted the new lease guidance using the modified retrospective approach and elected the transition option issued under ASU 2018-11, Leases (Topic 842) Targeted Improvements, allowing entities to continue to apply the legacy guidance in ASC 840, Leases, to prior periods, including disclosure requirements.

The Company has operating leases which are for land and office space and finance leases which are primarily related to equipment used at its data center. In connection with the Mawson Transaction (see Note 3), the Company assumed a land lease in Sandersville, GA, with the original term expiring in July 2023, but including eight separate three-year lease extension options. The operating lease liability recorded in connection with the acquisition assumes a full lease term of approximately 25 years with a discount rate of 6%. The assumed land lease includes approximately $75 in quarterly lease payments with a 4% increase in scheduled lease payments effective each successive lease option is exercised.

The Company's lease costs recognized during the six months ended March 31, 2023 and 2022 in the unaudited Consolidated Statements of Operations and Comprehensive Income (Loss) consist of the following:

	For the three months ended				For the six months ended
($ in thousands)	March 31, 2023		March 31, 2022		March 31, 2023		March 31, 2022
Operating lease cost (1)	$	79	$	28	$	159	$	56
Finance lease cost:
Depreciation expense of financed assets	$	39	$	95	$	119	$	190
Interest on lease obligations	$	4	$	10	$	10	$	21

(1) Included in general and administrative expenses

Other lease information is as follows:

	For the six months ended
($ in thousands)	March 31, 2023		March 31, 2022
Cash paid for amounts included in    measurement of lease obligations:
Operating cash outflows from operating leases	$	206	$	66
Operating cash outflows from finance leases	$	6	$	21
Financing cash outflows from finance leases	$	93	$	206

	March 31, 2023			September 30, 2022
Weighted-average remaining lease term -    operating leases	22.5 years			3.2 years
Weighted-average remaining lease term -    finance leases	1.39 years			1.53 years
Weighted-average discount rate - operating leases		6.90	%		4.50	%
Weighted-average discount rate - finance leases		5.50	%		5.50	%

The following is a schedule of the Company's lease liabilities by contractual maturity as of March 31, 2023:

($ in thousands) Fiscal Year	Operating Leases			Finance Leases
Remainder of Fiscal 2023	$	221		$	120
2024		452			154
2025		456			22
2026		464			1
2027		376			—
Thereafter		7,294			—
Gross lease liabilities		9,263			297
Less: imputed interest		(3,622	)		(10	)
Present value of lease liabilities	$	5,641		$	287
Less: Current portion of lease liabilities		(119	)		(216	)
Total lease liabilities, net of current portion	$	5,522		$	71