Commitments and Contingencies

12 Months Ended

Jul. 31, 2022

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 9 – Commitments and Contingencies

Right-of-Use Operating Lease – Related Party

In connection with the acquisition of OL on May 31, 2022, the Company acquired an existing Right-of-Use operating lease for office space. The lease is for an initial term of two (2) years at $500 per month. The lease does not contain any renewal options.

During the period September 1, 2021 through May 31, 2022 no rent was due. The Company is required to pay a total of $7,500 over a fifteen-month (15) period from June 1, 2022 through August 31, 2023.

The Company is leasing the office space from a family member of OL’s Chief Executive Officer.

At July 31, 2022, the Company has no financing leases as defined in ASC 842, “Leases.”

DESCRYPTO HOLDINGS, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

JULY 31, 2022 AND 2021

The tables below present information regarding the Company’s operating lease assets and liabilities at July 31, 2022:

	July 31, 2022
Assets
Operating lease - right-of-use asset - non-current	$	3,630
Liabilities
Operating lease liability	$	6,207
Weighted-average remaining lease term (years)		1.08
Weighted-average discount rate		8	%
The components of lease expense were as follows:
Operating lease costs
Amortization of right-of-use operating lease asset	$	559
Lease liability expense in connection with obligation repayment		92
Total operating lease costs	$	650
Supplemental cash flow information related to operating leases was as follows:
Operating cash outflows from operating lease (obligation payment)	$	908
Right-of-use asset obtained in exchange for new operating lease liability	$	4,189

Future minimum lease payments required under leases that have initial or remaining non- cancelable lease terms in excess of one year at July 31, 2022:

2023	$	6,000
2024		500
Total undiscounted cash flows		6,500
Less: amount representing interest		(293	)
Present value of operating lease liability		6,207
Less: current portion of operating lease liability		(5,710	)
Long-term operating lease liability	$	497

DESCRYPTO HOLDINGS, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

JULY 31, 2022 AND 2021

Student Athlete Licensing Agreements

The Company has entered into several agreements with student athletes related to the sale of NFT’s and related collectibles.

There may be initial sales as well as resales of these products. The Company and the student athlete have agreed to split the revenue from the initial sale. Additionally, the Company will pay the student athlete a commission for any resales.

At July 31, 2022 and 2021, the Company owed student athletes $575 and $0, respectively, which has been included as a component of accounts payable and accrued expenses in the consolidated balance sheets.