8. Property and Equipment, Net

As of June 30, 2025 and December 31, 2024, the Company’s property and equipment, net consisted of the following:

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For the six months ended June 30, 2025 and 2024, total depreciation on property and equipment was $1,853,234 and $1,267,612, respectively. For the six months ended June 30, 2025 and 2024, accumulated amortization of the right of use asset under finance lease amounted to $2,676,844 and $2,651,438, respectively. The right of use asset (the “ROU”) under finance lease of $7,572,566 consists of leased processing and cultivation premises. The Company capitalized $1,388,536 and $1,121,141 into inventory relating to depreciation associated with manufacturing equipment and production facilities for the six months ended June 30, 2025 and 2024, respectively. The associated capitalized depreciation costs are added to inventory and expensed as cost of sales when the product is sold.

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As of each of June 30, 2025 and 2024, in conjunction with the Company’s held for sale assessment and disposal of certain long-lived assets, the Company evaluated whether property and equipment showed any indicators of impairment, and it was determined that the recoverable amount of certain net assets was above book value. As a result, the Company recorded no impairment charge on property and equipment, net.