In August 2014 and November 2021, the Company acquired land use rights to build a factory of the Company in Dalian and Zhejiang, PRC.

Yuanchuang acquired a land use right on May 13, 2025 to build a factory in Anhui, PRC for cathode materials manufacturing.

Lump sum payments were made upfront to acquire the leased land from the owners with lease periods of 36 to 50 years, and no ongoing payments will be made under the terms of these land leases.

Amortization expenses of the prepaid land use rights were $78,305 and $87,931 for the three months ended March 31, 2025 and 2026 respectively.

No impairment loss was made to the carrying amounts of the prepaid land use right for the three months ended March 31, 2025 and 2026. 

On April 6, 2021, Nanjing CBAK entered into a lease agreement for warehouse space in Nanjing with a three year term, commencing on April 15, 2021 and expiring on April 14, 2024. The monthly rental payment is approximately RMB97,743 ($14,146) per month.  The lease was renewed for one year with a monthly rental of RMB86,913 (approximately $11,907) to May 14, 2025  and further extend for three years with a monthly rental of RMB94,156 (approximately $12,983) from May 14, 2025 to May 14, 2028.

On June 1, 2021, Hitrans entered into a lease agreement with liquid gas supplier for a five year term for supplying liquid nitrogen and oxygen, commencing on July 1, 2021. The monthly rental payment is approximately RMB5,310 ($773) per month.

On December 9, 2021, Hitrans entered into a lease agreement for extra staff quarters spaces in Zhejiang with a three year term, commencing on December 10, 2021 and expiring on December 9, 2024. The monthly rental payment is approximately RMB10,400 ($1,514) per month for the first year, RMB10,608 ($1,544) and RMB 10,820 ($1,575) per month from the second year and third year, respectively.

On March 1, 2022, Hitrans entered into a lease agreement for extra staff quarters spaces in Zhejiang with a five year term, commencing on March 1, 2022 and expiring on February 28, 2027. The monthly rental payment is approximately RMB15,840 ($2,306) per month for the first year, with 2% increase per year.

On October 20, 2022, CBAK Power entered into a lease agreement for staff quarters spaces in Dalian with a three year term, commencing on October 20, 2022 and expiring on October 19, 2025. The monthly rental payment is RMB61,905 ($9,012) per month.

On December 20, 2022, Hitrans entered into a lease agreement for extra staff quarters spaces in Zhejiang with a five year term commencing on December 20, 2022 and expiring on December 19, 2027. The monthly rental payment is RMB52,000 ($7,570) per month for the first year, with 2% increase per year.

On April 20, 2023, Hitrans entered into another lease agreement for extra staff quarters spaces in Zhejiang with a three year term commencing on May 1, 2023 and expiring on April 30, 2026. The monthly rental payment is RMB28,000 ($3,860) per month. On July 1, 2024, Hitrans entered into an amendment to early terminate the lease and entered into a new lease for a period of two years from July 1, 2024 to June 30, 2026. The monthly rental payment is RMB14,000 ($1,995) per month.

Nanjing CBAK entered into a lease agreement for office and factory spaces in Nanjing for a period of one year, commencing on August 1, 2023 and expiring on July 31, 2024. The monthly rental payment is approximately RMB160,743 ($22,649) per month. The lease was renewed for three years to August 31, 2027 with the same monthly rental.

CBAK Shangqiu entered into a lease agreement for staff quarters spaces in Shangqiu with a six-year term commencing on October 1, 2023 and expiring on September 30, 2029. The monthly rental payment is approximately RMB11,400 ($1,584) per month. On January 1, 2025, CBAK Shangqiu entered into an amendment to reduce the leased space and shorten the lease term to December 31, 2025. The new monthly rental is RMB7,717 ($1,003) per month.

CBAK Shangqiu entered into a lease agreement for manufacturing and factory spaces in Shangqiu with a term of six years, commencing on January 1, 2024 to December 31, 2029. The monthly rental payment is RMB265,487 ($36,769) per month. The landlord unconditionally forgave the accrued annual rent due to unsatisfied performance from the leasing spaces. The Company recognized the forgiveness as gains in 2025.

On March 1, 2024, Hitrans entered into a lease agreement with liquid gas supplier for forty-five months for supplying liquid nitrogen until December 11, 2027. The monthly rental payment is approximately RMB19,309 ($2,674) per month.

On April 26, 2024, Hitrans entered into a lease agreement with liquid gas supplier for a five-year term for supplying liquid argon to April 25, 2029. The monthly rental payment is approximately RMB1,062 ($146) per month.

Nanjing CBAK entered into a lease agreement for staff quarters spaces in Nanjing from March 1, 2024 to February 28, 2026. The monthly rental is RMB22,155 ($3,081) per month. On March 1, 2025, the month rental was reduced to RMB19,936 ($2,740) per month. 

CBAK Shangqiu entered into a lease agreement for staff quarters spaces in Shangqiu from May 16, 2024 to December 31, 2029 for a quarter rental of RMB19,404 ($2,765).

Nanjing CBAK entered into another lease for staff quarters spaces in Nanjing from June 1, 2024 to May 31, 2025. The monthly rental payment is RMB39,633 ($5,511) per month.

BAK Asia entered into a lease for office in Hong Kong from June 16, 2025 to June 30, 2028. The monthly rental payment was HKD10,000 ($1,290) per month.

CBAK Energy California entered into a lease for office in California from January 1, 2026 to January 31, 2028. The monthly rental was $2,716 for the first calendar year and will be $2,798 from the second year.

Operating lease expenses for the three months ended March 31, 2025 and 2026 for the capitation agreement was as follows:

The components of finance lease expenses for the three months ended March 31, 2025 and 2026 were as follows:

The following is a schedule, by years, of maturities of lease liabilities as of March 31, 2026:

Lease term and discount rate:

Supplemental cash flow information related to leases where the Company was the lessee for the three months ended March 31, 2025 and 2026 was as follows: