Commitments and Contingencies |
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Jun. 30, 2025 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Commitments and Contingencies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Commitments and Contingencies | Note 19 – Commitments and Contingencies
Lease commitments
The Company has entered in one operating factory lease agreement in Selangor expiring through January 2026. The lease contains an option to extend at the time of expiration, and the Company has the right of priority of exercising the option. The Company’s lease agreement does not contain any material residual value guarantees or material restrictive covenants. The lease is classified as an operating lease, and lease expense for the lease is recognized on the straight-line basis over the lease term which the Company estimated to be 1.5 years.
Operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The discount rate used to calculate present value is incremental borrowing rate or, if available, the rate which is implicit in the lease. The Company determines the incremental borrowing rate for each lease based primarily on its lease term in Malaysia, which is approximately 6.4% p.a. The total operating lease expenses for the lease agreement for the three and nine months ended June 30, 2025 were $12,525 and $36,951, respectively. Weighted-average remaining term and discount rate related to leases were as follows:
The following table sets forth the Company’s undiscounted future minimum lease payment schedule as of June 30, 2025:
The Company also entered in two operating lease agreements in Malaysia, which will expire till March 2026. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The leases contain options to extend at the time of expiration, but the Company will not exercise it. The Company did not recognize the operating lease ROU assets and lease liabilities on the balance sheet as this lease had an initial term of 12 months or less.
Operating lease expenses for the two lease agreements amounted to $3,413 and $55,910 for the three months ended June 30, 2025 and 2024, respectively, and $55,351 and $145,176 for the nine months ended June 30, 2025 and 2024, respectively, which were recorded under general and administrative expenses.
The following table sets forth the Company’s undiscounted future minimum lease payment schedule as of June 30, 2025. There were no commitment and contingency other than those stated below:
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