Leases

3 Months Ended

Mar. 31, 2026

6. Leases

The Company’s leases consist principally of leases for office and warehouse space. For leases with terms greater than twelve months, the related asset and obligation are recorded at the present value of the lease payments over the term. Many of these leases contain rental escalation clauses which are factored into the determination of the lease payments when appropriate. When available, the lease payments are discounted using the rate implicit in the lease; however, the Company’s current leases do not provide a readily determinable implicit rate. Therefore, the Company’s incremental borrowing rate is estimated to discount the lease payments based on information available at the lease commencement.

These leases contain both lease and non-lease components, which the Company has elected to treat as a single lease component. The Company elected not to recognize leases that have an original lease term, including reasonably certain renewal or purchase obligations, of twelve months or less in its condensed consolidated balance sheets for all classes of underlying assets. Lease costs for such short-term leases are expensed on a straight-line basis over the lease term.

All lease assets denominated in a foreign currency are measured using the exchange rate at the commencement of the lease. All lease liabilities denominated in a foreign currency are remeasured using the exchange rate as of the condensed consolidated balance sheet date.

Lease assets and liabilities

The following table presents the lease-related assets and liabilities and their respective classification on the condensed consolidated balance sheets:


		March 31,		December 31,
		2026		2025
ASSETS
Noncurrent
Operating lease right-of-use assets		$	2,712,619	$	2,930,441
Total operating lease right-of-use assets		$	2,712,619	$	2,930,441

LIABILITIES
Current
Current maturities of operating leases		$	619,659	$	661,047
Noncurrent
Noncurrent operating leases			2,146,943		2,297,161
Total lease liabilities		$	2,766,602	$	2,958,208

Weighted average remaining lease term:
Operating leases			4.0 years		4.2 years

Weighted average discount rate:
Operating leases			6.62%		6.55%

The components of lease costs were as follows:


		Three Months Ended March 31,
		2026		2025
Operating lease costs		$	209,571	$	207,555
Short-term lease costs			57,752		99,025
Lease costs - discontinued operations			1,176		2,697
Total lease costs		$	268,499	$	309,277

Supplemental cash flow information related to leases is as follows:

Future lease payments relating to the Company’s operating lease liabilities from continuing operations as of March 31, 2026 were as follows:


Years ending December 31,		Total
2026		$	586,308
2027			817,737
2028			837,819
2029			546,333
2030			302,193
Thereafter			76,064
Total future lease payments			3,166,454
Less: imputed interest			(399,852)
Total lease obligations			2,766,602
Less: current obligations			(619,659)
Noncurrent lease obligations		$	2,146,943

Three Months Ended March 31,

Cash paid for amounts included in measurement of liabilities:

Operating cash outflows for operating leases