Myseum.AI, Inc. Leases Disclosure
NOTE 6 – OPERATING LEASE RIGHT-OF-USE ASSETS AND OPERATING LEASE LIABILITIES
In January 2019, the Company renewed and extended the term of its lease facility for a three-year period from January 2019 to December 2021 starting with a monthly base rent of $2,567 plus a pro rata share of beginning January 2019. The base rent was subject to annual increases beginning the 2nd and 3rd lease year as defined in the lease agreement. In addition to the monthly base rent, the Company is charged separately for common area maintenance which is considered a non-lease component. These non-lease component payments are expensed as incurred and are not included in operating lease assets or liabilities. On August 27, 2021, the Company entered into an amendment agreement with the same landlord to modify the facility lease to relocate and increase the square footage of the lease premises. The lease term commenced on October 1, 2021 with a new monthly base rent of $7,156 plus a pro rata share of operating expenses beginning January 2022 and the lease expired on December 31, 2024. The base rent was subject to a 3% annual increase beginning in the 2nd and 3rd lease year as defined in the amended lease agreement. For the years ended December 31, 2024 and 2023, rent expense amounted to $90,955 and $95,310, respectively, and were included in general and administrative expenses. As of the date of this report, the Company has not renewed the lease and is leasing on a month-to-month basis. The Company does not record ROU assets or lease liabilities for short-term leases that have a term of twelve months or less at lease commencement, The Company can vacate the premises without any disruption and find alternative space, if needed.
On August 27, 2021, upon the execution of the amendment agreement, the Company recorded right-of-use assets and operating lease liabilities of $198,898 calculated using an incremental borrowing rate is 18.0% (based on historical borrowing rates).
Right-of- use assets are summarized below:
| December 31, 2024 | December 31, 2023 | |||||||
| Office lease | $ | 198,898 | $ | 198,898 | ||||
| Less accumulated amortization | (198,898 | ) | (124,921 | ) | ||||
| Right-of-use asset, net | $ | $ | 73,977 | |||||
Operating lease liabilities are summarized below:
| December 31, 2024 | December 31, 2023 | |||||||
| Office lease | $ | 198,898 | $ | 198,898 | ||||
| Reduction of lease liability | (198,898 | ) | (115,224 | ) | ||||
| Total lease liability | 83,674 | |||||||
| Less: current portion | 83,674 | |||||||
| Long term portion of lease liability | $ | $ | ||||||
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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.