Newton Golf Company, Inc. Leases Disclosure
NOTE 6 – LEASE LIABILITIES
The Company determines whether a contract is, or contains, a lease at inception. Right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset during the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at lease commencement based upon the estimated present value of unpaid lease payments over the lease term. The Company leases its office and warehouse locations, and certain warehouse equipment. Leases with an initial term of 12 months or less are not included on the balance sheets.
On April 1, 2022, the Company entered a facility lease for a 4,000 square foot facility in St. Joseph, Missouri, to expand its manufacturing business to include advanced premium golf shafts. The lease is for 24 months, and the monthly rent is approximately $1,500. On January 1, 2023, the Company amended its lease by adding an additional 5,000 square feet and extending the lease term to December 2024. The amended lease is for 24 months from January 1, 2023, and the monthly rent is approximately $3,000. On December 14, 2023, the Company again amended its lease by extending the lease term to December 2025.
In July 2025, the Company entered into an additional lease agreement that added a parking lot and a designated space for a dumpster. The lease runs from January 1, 2025 through December 31, 2027, with monthly rent increasing from $3,600 to $3,900.
The Company’s ROU asset balance was $34,000 as of December 31, 2024. During the year ended December 31, 2025, the Company recognized an additional ROU asset of $106,000 related to its new lease and recorded amortization of ROU assets of $56,000, resulting in an ROU asset balance of $84,000 as of December 31, 2025.
The Company’s lease liability balance was $34,000 as of December 31, 2024. In connection with the 2025 lease agreement, the Company recognized an additional lease liability of $106,000. During the year ended December 31, 2025, the Company made lease payments of $56,000, resulting in a lease liability of $84,000 as of December 31, 2025. Of this amount, $40,000 was classified as current and $44,000 was classified as long-term.
During the years ended December 31, 2025 and 2024, lease costs totaled approximately $49,000 and $98,000, respectively.
As of December 31, 2025, the weighted average remaining lease term for operating leases was 2.0 years, and the weighted average discount rate for operating leases was 10.0%.
Future minimum lease payments under the leases are as follows:
| Years Ending December 31, | Amount | |||
| 2026 | $ | 47,000 | ||
| 2027 | 47,000 | |||
| Total payments | 94,000 | |||
| Less: Amount representing interest | (10,000 | ) | ||
| Present value of net minimum lease payments | 84,000 | |||
| Less: Current portion | (40,000 | ) | ||
| Non-current portion | $ | 44,000 | ||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 31, 2026 | Showing above |
| 2024 | Apr 4, 2025 | |
| 2023 | Mar 18, 2024 | |
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.