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LEASES

6 Months Ended

Jun. 30, 2025

NOTE 15. LEASES

The Company has various lease agreements with terms up to 20 years. All the leases are classified as operating leases.

Maturity of lease liabilities under our non-cancellable operating leases as of June 30, 2025 were as follows:

Payments due by period
2025 (remaining six months)	$	2,121,007
2026		3,923,741
2027		2,956,171
2028		2,280,186
2029		1,617,808
Thereafter		824,584
Total undiscounted operating lease payments	$	13,723,497
Less: Imputed interest		(1,308,790	)
Present value of operating lease liabilities	$	12,414,707

The following table summarizes the Company’s operating leases:

SCHEDULE OF COMPANY’S OPERATING LEASE

Balance Sheet Classification	June 30, 2025		December 31, 2024
Right of use assets	$	12,386,466	$	14,232,240

Operating lease liability, current	$	3,687,002	$	3,596,987
Operating lease liability, net of current		8,727,705		10,584,431
Total operating lease liabilities	$	12,414,707	$	14,181,418

The amortization of the right-of-use assets of approximately $1,846,000 and $1,438,000 for the six months ended June 30, 2025 and 2024, respectively, were included in operating cash flows.

The following table provides a summary of other information related to the leases at June 30, 2025 and December 31, 2024:

SCHEDULE OF OPERATING LEASE TERM

Other Information	June 30, 2025			December 31, 2024
Weighted-average remaining lease term for operating leases		4 years			4 years
Weighted-average discount rate for operating leases		5.24	%		5.19	%

Rent expense for the three months ended June 30, 2025 and 2024 was approximately $974,000 and $940,000, respectively. Rent expense for the six months ended June 30, 2025 and 2024 was approximately $1,951,000 and $1,864,000, respectively. It is included in selling, general and administrative expenses in the accompanying condensed consolidated carve-out statements of operations.

The components of lease expenses for the three and six months ended June 30, 2025 and 2024 were as follows:

SCHEDULE OF COMPONENTS OF LEASE EXPENSE

	2025		2024		2025		2024
	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Operating lease cost	$	864,402	$	643,036	$	1,719,038	$	1,280,138
Variable lease cost		46,163		218,165		104,950		425,711
Short-term lease cost		63,758		79,291		126,736		157,823
Total rent expense	$	974,323	$	940,492	$	1,950,724	$	1,863,672

The aggregate cash payments under the leasing arrangement were approximately $1,767,000 and $1,365,000 for the six months ended June 30, 2025 and 2024, respectively, were included in operating cash flows.