OPERATING LEASE RIGHT-OF-USE ASSETS AND OPERATING LEASE LIABILITIES

6 Months Ended

Oct. 31, 2022

Operating Lease Right-of-use Assets And Operating Lease Liabilities

OPERATING LEASE RIGHT-OF-USE ASSETS AND OPERATING LEASE LIABILITIES

NOTE 7 – OPERATING LEASE RIGHT-OF-USE ASSETS AND OPERATING LEASE LIABILITIES

On May 1, 2021, the Company entered into a lease agreement for its lease facility in Cheyenne, Wyoming. The term of the lease is for a two-year period from May 2021 to May 2023 starting with a monthly base rent of $1,667. The Company has an option to renew the lease for an additional three years beyond the primary term. The Company typically excludes options to extend the lease in a lease term unless it is reasonably certain that the Company will exercise the option and when doing so is in the Company’s sole discretion. The base rent is subject to an annual increase as defined in the lease agreement. In addition to the monthly base rent, the Company is charged separately for common area maintenance which is considered a non-lease component. These non-lease component payments are expensed as incurred and are not included in operating lease assets or liabilities.

On September 1, 2021, the Company entered into another lease agreement for its lease facility in Cheyenne, Wyoming. The term of the lease is for a two-year period from September 2021 to August 2023. The monthly base rent was $3,100 and was lowered to $2,950 starting in March 2022. The Company has an option to renew the lease for an additional two years upon giving a written notice from 60 to 120 days prior to the expiration of the initial term of this lease. The Company typically excludes options to extend the lease in a lease term unless it is reasonably certain that the Company will exercise the option and when doing so is in the Company’s sole discretion.

U.S. GOLD CORP. AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

OCTOBER 31, 2022

During the six months ended October 31, 2022 and 2021, lease expense of $28,075 and $16,350 was included in general and administrative expenses as reflected in the accompanying consolidated statements of operations. During the three months ended October 31, 2022 and 2021, lease expense of $14,036 and $11,350 was included in general and administrative expenses as reflected in the accompanying consolidated statements of operations.

Right-of-use assets are summarized below:

	October 31, 2022		April 30, 2022
Operating leases	$	38,362	$	64,064

Operating Lease liabilities are summarized below:

	October 31, 2022		April 30, 2022
Operating lease, current portion	$	38,512	$	55,630
Operating lease, long term portion		-		8,734
Total lease liability	$	38,512	$	64,364

The weighted average remaining lease term for the operating leases is 0.67 years and the weighted average incremental borrowing rate is 8.0% at October 31, 2022.

The following table includes supplemental cash and non-cash information related to the Company’s lease:

	Period ended October 31,
	2022		2021
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating lease	$	28,000	$	16,200
Lease assets obtained in exchange for new operating lease liabilities	$	-	$	106,631

The remaining minimum lease payments under non-cancelable operating leases at October 31, 2022 are as follows:

Year ended April 30, 2023 - remainder		28,000
Year ended April 30, 2024		11,800
Total	$	39,800
Less: imputed interest		(1,288	)
Total present value of lease liability	$	38,512