NOTE 7 – FINANCE LEASE RIGHT-OF-USE ASSETS

Finance lease right-of-use asset, net consists of the following:

Finance Lease Right-Of-Use Assets - Schedule of Property, Plant and Equipment Under Finance Leases

The above buildings erected on parcels of land located in Shouguang, PRC, are collectively owned by local townships. The Company has not been able to obtain property ownership certificates over these buildings as the Company could not obtain land use rights certificates on the underlying parcels of land.

During the year ended December 31, 2024, depreciation and amortization expense totaled $3,045,602 were recorded in direct labor and factory overheads incurred during plant shutdown, cost of net revenue, and general & administrative expenses.

During the year ended December 31, 2023, depreciation and amortization expense totaled $1,279,367 were recorded in direct labor and factory overheads incurred during plant shutdown, cost of net revenue, and general & administrative expenses.

On June 26, 2024, Company, SHSI, entered into a Crude Salt Assets Acquisition Agreement with the total transfer price of $18,010,850. On June 27, 2024, SHSI entered into four Crude Salt Field Acquisition Agreements with 4 sellers, with the total transfer price of $5,644,388, $6,140,260, $2,892,097, and $6,369,207, respectively. Company has not been able to obtain property ownership certificates over these salt pans.

In 2024, Company purchased crude salt assets at a total cost of $39,056,802.

See Note 23- Restatement, for discussion regarding the impact of the Restatement.