Note 10 – Leases

Leases are classified as operating leases or finance leases in accordance with ASC 842 Leases. The Company’s operating leases mainly related to the rights to use building and office facilities. For leases with terms greater than 12 months, the Company records the related asset and liability at the present value of lease payments over the term. Certain leases include rental escalation clauses, renewal options and/or termination options, which are factored into the Company’s determination of lease payments when appropriate.

The balances for the operating leases where the Company is the lessee are presented as follows within the unaudited interim condensed consolidated balance sheets:

Future lease payments under operating leases as of June 30, 2026 were as follows:

Lease expense for all the Company’s operating leases for the three months ended June 30, 2026 and 2025 were $97,827 and $118,524, respectively. Lease payments for all the Company’s operating leases for the three months ended June 30, 2026 and 2025 were $97,827 and $155,461, respectively. Lease expense for all the Company’s operating leases for the six months ended June 30, 2026 and 2025 were $188,766 and $242,016, respectively. Lease payments for all the Company’s operating leases for the six months ended June 30, 2026 and 2025 were $97,827 and $320,117, respectively.  

For the three months ended June 30, 2026 and 2025, the Company incurred $17,092 and $120,885 short-term lease expenses and the short-term lease payments were $7,875 and $273,740, respectively. For the six months ended June 30, 2026 and 2025, the Company incurred $119,050 and $167,622 short-term lease expenses and the short-term lease payments were $10,500 and $336,056, respectively.

Effective from December 1, 2025, the Company subleased partial of the lease office space to a third party for the remaining of the head lease term. Since the Company has not been relieved as the primary obligor of the head lease, the Company cannot net the sublease income against its lease payment to calculate the lease liability and right-of-use (“ROU”) asset. The Company records sub-lease income over the term of the subleases on a straight-line basis.

During the three months ended March 31, 2026, the Company recognized sublease income in accordance with the terms of the sublease agreement. Subsequent to the filing of the Company’s Quarterly Report for the three months ended March 31, 2026, the sublease agreement was terminated in April 2026. Following the termination of the sublease, the Company resumed making rental payments directly to the landlord under the head lease for the remainder of the lease term. 

For the three and six months ended June 30, 2026, the Company recorded sublease income of $0 and $97,826, respectively, as other income on the accompanying unaudited interim condensed consolidated statements of operations and comprehensive loss. For the three and six months ended June 30, 2025, the Company did no have any sublease income.