OPERATING LEASE

6 Months Ended

Jun. 30, 2025

NOTE 19 – OPERATING LEASE

Effective October 29, 2021, the ReachOut Technology Corp’s subsidiary (RedGear, LLC) entered into a lease for office facilities at 3636 North Central Avenue, Phoenix, Arizona. The lease extends through October 31, 2025, for $3,224.83 per month with annual escalation of 3%. The liability and Right of Use Asset was recognized for $125,364. The liability and the Right of Use Asset were $33,242, and $31,730, respectively at December 31, 2024. The right of use asset and related obligation were assigned to a third party on March 31, 2025.

The offices for the Company are shared with a related party ReachOut IL (an S corporation), under an arrangement that is not formalized.

Schedule of right of use asset
	June 30, 2025			December 31, 2024
Operating lease at inception	$	767,068		$	767,068
Less accumulated reduction		(741,722	)		(735,338	)
Reduction due to deconsolidation		(25,346	)		-
Balance ROU asset	$	-		$	31,730

Operating lease liabilities at inception	$	767,068		$	767,068
Reduction of lease liabilities (includes termination write-off)		(740,663	)		(733,826	)
Reduction due to deconsolidation		(26,405	)		-
Total lease liabilities		-			33,242
Less: current portion		-			(33,242	)
Lease liabilities, non-current	$	-		$	-

Non-cancellable operating lease total future payments are summarized below:


Total minimum operating lease payments	$	-	$	33,242
Less discount to fair value		-		-
Total lease liability	$	-	$	33,242

For the six months ended June 30, 2025 rent expense was $6,799.