| LEASES |
NOTE 12 — LEASES
The Company and its subsidiaries are party to various
office leases with terms expiring at different dates through February 2032. The amortizable life of the right-of-use asset is limited
by the expected lease term. Although certain leases include options to extend, the Company did not include these in the right-of-use asset
or lease liability calculations because it is not reasonably certain that the options will be executed.
| Schedule of right of use asset or lease liability calculations | |
| | |
| |
| Operating Leases | |
As of
March 31, 2025 | | |
As of
December 31, 2024 | |
| Assets | |
| | | |
| | |
| Right-of-use asset | |
$ | 4,189,988 | | |
$ | 4,606,431 | |
| | |
| | | |
| | |
| Liabilities | |
| | | |
| | |
| Current | |
| | | |
| | |
| Lease liability | |
$ | 1,439,090 | | |
$ | 1,839,323 | |
| | |
| | | |
| | |
| Noncurrent | |
| | | |
| | |
| Lease liability | |
$ | 3,203,660 | | |
$ | 3,247,291 | |
| | |
| | | |
| | |
| Total operating lease liability | |
$ | 4,642,750 | | |
$ | 5,086,614 | |
| Schedule of finance lease | |
| | |
| |
| Finance Lease | |
As of
March 31, 2025 | | |
As of
December 31, 2024 | |
| Assets | |
| | | |
| | |
| Right-of-use asset | |
$ | 137,167 | | |
$ | 132,566 | |
| | |
| | | |
| | |
| Liabilities | |
| | | |
| | |
| Current | |
| | | |
| | |
| Lease liability | |
$ | 92,008 | | |
$ | 80,349 | |
| | |
| | | |
| | |
| Noncurrent | |
| | | |
| | |
| Lease liability | |
$ | 54,149 | | |
$ | 58,742 | |
| | |
| | | |
| | |
| Total finance lease liability | |
$ | 146,157 | | |
$ | 139,091 | |
The tables below show the lease
income and expenses recorded in the condensed consolidated statements of operations incurred during the three months ended March 31, 2025
and 2024 for operating and financing leases, respectively.
| Schedule of lease income and expenses |
|
|
|
|
|
|
|
|
| |
|
|
|
Three Months Ended March 31, |
|
| Lease costs |
|
Classification |
|
2025 |
|
|
2024 |
|
| Operating lease costs |
|
Selling, general and administrative expenses |
|
$ |
549,399 |
|
|
$ |
674,669 |
|
| Sublease income |
|
Selling, general and administrative expenses |
|
|
(12,665 |
) |
|
|
(105,351 |
) |
| Net operating lease costs |
|
|
|
$ |
536,734 |
|
|
$ |
569,318 |
|
| |
|
|
|
Three Months Ended March 31, |
|
| Lease costs |
|
Classification |
|
2025 |
|
|
2024 |
|
| Amortization of right-of-use assets |
|
Selling, general and administrative expenses |
|
$ |
21,419 |
|
|
$ |
15,895 |
|
| Interest on lease liability |
|
Selling, general and administrative expenses |
|
|
2,803 |
|
|
|
3,126 |
|
| Total finance lease costs |
|
|
|
$ |
24,222 |
|
|
$ |
19,021 |
|
Lease Payments
For the three months ended March
31, 2025 and 2024, the Company made payments in cash related to its operating leases in the amounts of $552,571 and $665,807, respectively.
Future minimum lease payments
for leases for the remainder of 2025 and thereafter, were as follows:
| Schedule of future minimum payments under operating lease agreements |
|
|
|
|
| Year |
|
Operating Leases |
|
Finance Leases |
| |
2025 |
|
|
$ |
1,674,446 |
|
|
$ |
75,448 |
|
| |
2026 |
|
|
|
2,054,617 |
|
|
|
64,133 |
|
| |
2027 |
|
|
|
918,827 |
|
|
|
15,677 |
|
| |
2028 |
|
|
|
155,710 |
|
|
|
396 |
|
| |
2029 |
|
|
|
159,255 |
|
|
|
— |
|
| |
Thereafter |
|
|
|
355,077 |
|
|
|
— |
|
| |
Total lease payments |
|
|
$ |
5,317,932 |
|
|
$ |
155,654 |
|
| |
Less: Imputed interest |
|
|
|
(675,182 |
) |
|
|
(9,497 |
) |
| |
Present value of lease liabilities |
|
|
$ |
4,642,750 |
|
|
$ |
146,157 |
|
As of March 31, 2025, the Company’s
weighted average remaining lease term on its operating and finance leases is 4.15 years and 1.78 years, respectively, and the Company’s
weighted average discount rate is 8.83% and 8.16% related to its operating and finance leases, respectively.
|