OPERATING LEASES

9 Months Ended

Sep. 30, 2024

Operating Leases

OPERATING LEASES

NOTE 13 — OPERATING LEASES — AS A LESSEE

The Company has entered into operating leases for offices and sublease purposes, with terms ranging from two to nine years. The estimated effect of lease renewal and termination options, as applicable, that are reasonably certain to be exercised in the determination of the lease term and initial measurement of right-of-use assets and lease liabilities was included in the unaudited consolidated financials.

During the nine months ended September 30, 2024 and 2023, certain operating leases were guaranteed by related parties of the Company.

Operating lease expenses for lease payments are recognized on a straight-line basis over the lease term. Leases with an initial term of twelve months or less are not recorded on the unaudited consolidated balance sheets.

The components of lease costs are as follows:

	For the Nine Months Ended September 30,
	2024		2023
Operating lease costs	$	2,914,366	$	2,960,243
Short-term lease costs		239,673		333,062
Total lease costs	$	3,154,039	$	3,293,305

The following table presents supplemental information related to the Company’s operating leases:

	For the Nine Months Ended September 30,
	2024			2023
Operating cash flows from operating leases	$	3,107,447		$	2,988,222
Operating lease right-of-use assets obtained in exchange for operating lease liabilities	$	—		$	1,029,518
Remeasurement of operating lease liabilities and right-of-use assets due to lease modifications	$	2,408,752		$	2,110,079
Weighted average remaining lease term (years)		2.05			2.00
Weighted average discount rate (per annum)		0.19	%		0.19	%

SBC MEDICAL GROUP HOLDINGS INCORPORATED

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 13 — OPERATING LEASES — AS A LESSEE (cont.)

As of September 30, 2024, the future maturity of lease liabilities is as follows:

Years ending December 31,	Lease Payment
Remaining of 2024	$	1,079,267
2025		3,430,730
2026		459,579
2027		180,494
2028		171,043
Thereafter		277,567
Total undiscounted lease payments		5,598,680
Less: imputed interest		(8,864	)
Total operating lease liabilities	$	5,589,816