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OPERATING LEASES
 9 Months Ended
Sep. 30, 2025
Operating Leases  
OPERATING LEASES

NOTE 8 – OPERATING LEASES

 

The Company periodically enters operating lease contracts for office space and equipment. Arrangements are evaluated at inception to determine whether such arrangements constitute a lease. Right of use assets (“ROU assets”) represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities were recognized on the transition date based on the present value of lease payments over the respective lease term, with the office space ROU asset adjusted for deferred rent liability.

 

 

As of September 30, 2025, the Company had two material operating leases for office space. The leases had remaining lease terms of 66 and 35 months as of September 30, 2025, respectively. For practical expediency, the Company has elected not to recognize ROU assets and lease liabilities related to short-term leases.

 

In accordance with ASC Topic 842, Leases, the Company has recorded ROU assets of $2,154,721 and related lease liabilities of $2,302,465 as of September 30, 2025. The Company recorded lease expense of $136,032 and $121,126 for the three months ended September 30, 2025 and 2024, respectively. The Company recorded lease expense of $396,229 and $416,394 for the nine months ended September 30, 2025 and 2024, respectively. Cash paid for amounts included in the measurement of operating lease liabilities was $394,149 and $362,491 for the nine months ended September 30, 2025 and 2024, respectively.

 

The present value of the Company’s operating lease liabilities as of September 30, 2025 is shown below:

 

Maturity of Operating Lease Liabilities

 

   September 30,
2025		 
Remainder of 2025  $155,818 
2026   619,996 
2027   631,286 
2028   596,412 
2029   514,160 
2030   521,805 
Thereafter   131,884 
      
Total lease payments   3,171,361 
Less imputed interest   (868,896)
Present Value of Lease Liabilities  $2,302,465 
      
Operating lease liabilities – current  $338,990 
Operating lease liabilities – long-term  $1,963,475 

 

As of September 30, 2025, the Company’s operating leases had a weighted average remaining lease term of 5.2 years and a weighted average discount rate of 13.3%.