Leases

12 Months Ended

Dec. 31, 2024

Leases

Leases

Note 10 Leases

During 2024, the Company entered into lease agreements for equipment utilized in its manufacturing facility. The Company has determined that the lease agreements are finance leases. There is a $1 buyout option at the end of the lease term which makes it reasonably certain that the Company will exercise this option and purchase the machinery and the details of the purchase option are in line with the criteria of a finance lease.

The ROU asset is grouped with property and equipment. The asset is amortized on a straight-line basis over the life of the underlying asset rather than the lease term due to the purchase options in the lease. The amortization expense is grouped with the depreciation expense of the Company’s other property and equipment. The initial recognition of the finance lease liability was recorded based on the present value of future payments. The interest expense is calculated using the incremental borrowing rate of the Company, and is grouped in the interest expense line on the statement of operations.

The components of operating and finance lease costs are as follows for the years ended December 31:

	2024		2023
Operating lease cost	$	-	$	-
Finance Lease Cost:
Amortization of assets		126,343		-
Interest on liabilities		66,454		-
Total lease cost	$	192,797	$	-

There were no variable payments or material short-term rentals for the years ended December 31, 2024 and 2023.

Supplemental cash flow information related to leases are as follows for the years ended December 31:

	2024		2023
Cash paid for amounts included in measurement of lease obligations:
Operating cash flows from operating leases	$	-	$	15,532
Operating cash flows from finance leases		66,454		-
Financing cash flows from finance leases		95,080		-

SYNTEC OPTICS HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2024 AND 2023

Note 10 Leases – Continued

The following table summarizes weighted average remaining lease term and discount rates as of December 31, 2024 and 2023:

	2024			2023
Weighted average remaining lease term (years)
Operating leases		n/a			n/a
Finance leases		5.00			N/A
Weighted average discount rate
Operating leases		n/a			n/a
Finance leases		8.4	%		N/A

Future maturities of our lease liabilities are as follows as of December 31:

2025	$	432,009
2026		513,525
2027		513,525
2028		513,525
2029		513,524
Thereafter		-
Total Undiscounted Lease Obligations		2,486,108
Less: Imputed Interests		417,657
Present Value of Lease Obligations	$	2,068,451