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Leases

12 Months Ended

Dec. 31, 2024

Note 14 – Leases

We have entered into operating and finance leases primarily for real estate and equipment rental. These leases have terms which range from three years to six years, and often include one or more options to renew or in the case of equipment rental, to purchase the equipment. These operating and finance leases are listed as separate line items on our consolidated balance sheets and represent our right to use the underlying asset for the lease term. Our obligations to make lease payments are also listed as separate line items on our consolidated balance sheets. As of December 31, 2024 and December 31, 2023, total operating and financed right-of use assets were $913,439 and $18,209, and $805,786 and $72,560, respectively.

For the years-ended December 31, 2024 and 2023, we recorded $54,356 and $96,190 in amortization expense related to finance leases.

For the years-ended December 31, 2024 and 2023, we recorded $334,243 and $358,667 respectively, in rent expense related to operating leases.

In May 2023, we entered into an agreement to lease 4,128 square feet of office space in San Jose, CA commencing on September 1, 2023. The lease has a term of sixty-five months with an abatement period of five months and will cost approximately $208,000 during its first year. Thereafter, the lease payments increase by 3%.

In January 2024, we amended and renewed our lease at our corporate headquarters in Little Rock, Arkansas. The lease was extended for thirty-six months commencing on February 1, 2024 and expiring on January 31, 2027 and will cost approximately $127,000 during its first year. Thereafter, the lease payments increase by 2% annually.

Because the rate implicit in each lease is not readily determinable, we use our incremental borrowing rate to determine the present value of the lease payments.

Information related to our operating lease liabilities for are as follows:

	December 31, 2024
Cash paid for operating lease liabilities	$	350,401
Weighted-average remaining lease term	2.78 years
Weighted-average discount rate		10.5	%

Minimum future lease payments ended December 31, 2024
2025	$	349,194
2026		354,565
2027		237,867
2028		233,727
2029		19,526
		1,194,879
Less imputed interest		(197,007	)
Total lease liabilities	$	997,872

Information related to our financed lease liabilities are as follows:

	December 31, 2024
Cash paid for finance lease liabilities	$	50,801
Weighted-average remaining lease term	.76 years
Weighted-average discount rate		6.25	%

Minimum future lease payments ended December 31, 2024

2025		18,491
		18,491
Less imputed interest		(282	)
Total lease liabilities	$	18,209