SharonAI Holdings Inc. Leases Disclosure
Note 15. Leases
The Company leases GPU and associated computer and networking equipment under non-cancelable finance lease agreements. Lease terms generally range from 3 to 5 years and may include options to extend or terminate the lease. Lease agreements may contain both lease and non-lease components, which the Company accounts for as a single lease component for all asset classes under a practical expedient election. The Company also elected the short-term lease exemption for all leases with original terms of 12 months or less, whereby such leases are not recognized on the consolidated balance sheet.
Lease cost
The components of lease cost were as follows:
| For the Years Ended | ||||||||
| December 31, | ||||||||
| 2025 | 2024 | |||||||
| Description | ||||||||
| Finance lease – interest | $ | 319,944 | $ | 25,275 | ||||
| Finance lease – amortization | 3,211,697 | 89,748 | ||||||
| Total Lease Cost | $ | 3,531,641 | $ | 115,023 | ||||
Maturity analysis of lease liabilities
Future minimum lease payments as of December 31, 2025 are as follows:
| December 31, | December 31, | |||||||
| 2025 | 2024 | |||||||
| Description | ||||||||
| 2025 | $ | $ | 230,044 | |||||
| 2026 | 1,324,782 | 230,044 | ||||||
| 2027 | 1,324,782 | 230,044 | ||||||
| 2028 | 1,324,782 | 230,044 | ||||||
| 2029 | 1,201,139 | 115,022 | ||||||
| 2030 | 379,091 | |||||||
| Total | 5,554,576 | 1,035,198 | ||||||
| Less: Imputed interest | 563,675 | 88,492 | ||||||
| Present value of lease liabilities | $ | 4,990,901 | $ | 946,706 | ||||
Other information
| December 31, | December 31, | |||||||
| 2025 | 2024 | |||||||
| Weighted-average remaining lease term (years) | 3.9 | 4.5 | ||||||
| Weighted-average discount rate: | 5.72 | % | 5.19 | % | ||||
| ROU assets obtained in exchange for ROU Liability | $ | 8,236,478 | $ | 1,057,779 | ||||
| Operating cash impact of finance leases | $ | 3,463,635 | $ | 26,847 | ||||
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.