The Company has several operating leases for railcars, machinery and equipment, and storage facilities. Operating leases are included in right-to-use lease assets, current operating lease liabilities, and long-term lease liabilities on the Company's consolidated balance sheets. These assets and liabilities are recognized at the commencement date based on the present value of remaining lease payments over the lease term using the Company's secured incremental borrowing rates or implicit rates, when readily determinable. Short-term operating leases, which have an initial term of 12 months or less, are not recorded on the consolidate balance sheet. These leases have terms ranging from 3-15 years and may include renewal terms. The renewal options are not included in the measurement of the right of use assets and lease liabilities unless the Company is reasonably certain to exercise the optional renewal periods. The Company does not have lease arrangements with residual value guarantees, sale-leaseback terms or material restrictive covenants. The Company does not have any material finance lease obligations nor sublease agreements.

Lease expense for these operating leases is recognized on a straight-line basis over the lease terms. The components of lease costs recognized within our consolidated statements of operations for the years ended December 31, 2025, 2024, and 2023 were as follows:


	2025		2024		2023

Cost of revenues - Freight and rail	$	6,144,955	$	4,932,702	$	4,264,107
Cost of revenues - Production	778,169		300,902		272,805
Administration expenses	20,124		18,735		17,542
Total operating lease costs	$	6,943,248	$	5,252,339	$	4,554,454


	2025		2024		2023
Cash paid for amounts included in measurement of lease liabilities	$	6,171,763	$	4,674,912	$	4,146,569

Supplemental non-cash information:
Right-of-use assets obtained in exchange for lease liabilities	$	55,963,206	$	11,123,660	$	8,956,408


	Railcars		Other		Total
Year ended December 31:
2026	$	11,193,467	$	476,719	$	11,670,186
2027	10,450,997		474,830		10,925,827
2028	10,312,687		461,612		10,774,299
2029	10,312,687		426,879		10,739,566
2030	9,714,187		366,831		10,081,018
Thereafter	49,709,684		536,352		50,246,036
Total lease payments	101,693,709		2,743,223		104,436,932
Less amount of lease payments representing interest	(20,671,126)		(430,208)		(21,101,334)
Total present value of lease payments	$	81,022,583	$	2,313,015	$	83,335,598