NOTE 11—LEASES:
The Company leases certain of its facilities and equipment under operating lease agreements, which expire in various periods through 2036. The Company’s finance leases are not material.
The following table presents the various components of operating lease costs:
| | | | | | | | | | | | | | | | | |
| Fiscal Years Ended November 30, |
| 2025 | | 2024 | | 2023 |
| Operating lease cost | $ | 323,427 | | | $ | 295,111 | | | $ | 216,774 | |
| Short-term lease cost | 69,823 | | | 89,001 | | | 21,802 | |
| Variable lease cost | 53,709 | | | 44,237 | | | 58,283 | |
| Sublease income | (2,959) | | | (4,492) | | | (5,394) | |
| Total operating lease cost | $ | 444,000 | | | $ | 423,857 | | | $ | 291,465 | |
The following table presents a maturity analysis of expected undiscounted cash flows for operating leases on an annual basis for the next five fiscal years and thereafter as of November 30, 2025:
| | | | | |
| Fiscal Years Ending November 30, | |
| 2026 | $ | 312,965 | |
| 2027 | 251,660 | |
| 2028 | 192,770 | |
| 2029 | 129,777 | |
| 2030 | 71,067 | |
| Thereafter | 86,524 | |
| Total payments | 1,044,763 | |
| Less: imputed interest* | 146,580 | |
| Total present value of lease payments | $ | 898,183 | |
*Imputed interest represents the difference between undiscounted cash flows and discounted cash flows.The following amounts were recorded in the consolidated balance sheets related to the Company’s operating leases:
| | | | | | | | | | | | | | | | | | | | |
| | | | As of November 30, |
Description | | Balance Sheet location | | 2025 | | 2024 |
| Operating lease ROU assets | | Other assets | | $ | 857,025 | | | $ | 816,550 | |
| Current operating lease liabilities | | Other accrued liabilities | | 256,739 | | | 235,912 | |
| Non-current operating lease liabilities | | Other long-term liabilities | | 641,444 | | | 625,888 | |
The following table presents supplemental cash flow information related to the Company’s operating leases. Cash payments related to variable lease costs and short-term leases are not included in the measurement of operating lease liabilities, and, as such, are excluded from the amounts below:
| | | | | | | | | | | | | | | | | | | | |
| | Fiscal Years Ended November 30, |
| | 2025 | | 2024 | | 2023 |
| Cash paid for amounts included in the measurement of lease liabilities | | $ | 345,027 | | | $ | 310,859 | | | $ | 225,142 | |
| Non-cash ROU assets obtained in exchange for lease liabilities | | 264,095 | | | 295,894 | | | 152,071 | |
The weighted-average remaining lease term and discount rate as of November 30, 2025 and 2024 were as follows:
| | | | | | | | | | | | | | |
| | As of November 30, |
| | 2025 | | 2024 |
| Weighted-average remaining lease term (years) | | 4.20 | | 4.50 |
| Weighted-average discount rate | | 6.85 | % | | 6.91 | % |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.