Company: REI
Filing Date: 2025-08-06
Form Type: 10-Q
Source: 0001628280-25-038401
Chunk: 95

Company: RING ENERGY, INC.
Filing Date: 2025-08-06
Form: 10-Q
Item: Part I, Item 8
Chunk 95
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 its offices in Midland, Texas and The Woodlands, Texas. The Midland office was originally under a five-year lease which began January 1, 2021. The Midland office lease was amended effective October 1, 2022, with the revised five-year lease ending September 30, 2027. Beginning January 15, 2021, the Company entered into a five-and-a-half-year sub-lease for office space in The Woodlands, Texas; however, effective as of May 31, 2023, The Woodlands office sub-lease was terminated. On May 9, 2023, the Company entered into a 71-month (five years and 11-month) new lease for a larger amount of office space in The Woodlands, Texas. The future payments for these office spaces are reflected in the future lease payments schedule below.The Company has month to month leases for office equipment and compressors used in its operations on which the Company has elected to apply ASU 2016-02 (i.e. to not capitalize). The office equipment and compressors are not subject to ASU 2016-02 based on the agreement and nature of use. These leases are for terms that are less than 12 months and the Company does not intend to continue to lease this equipment for more than 12 months. The lease costs associated with these leases is reflected in the short-term lease costs within Lease operating expenses, shown below.The Company has financing leases for vehicles. These leases have an initial term of 36 months at the end of which the Company owns the vehicles. These vehicles are generally sold at the end of their term and the proceeds are settled in cash or applied to a new vehicle.Future lease payments associated with these operating and financing leases as of June 30, 2025 are as follows:20252026202720282029Other Future YearsTotalOperating lease payments (1)$366,218 $636,649 $460,497 $250,606 $149,628 $— $1,863,598 Financing lease payments (2)433,416 664,994 282,147 24,213 — — 1,404,770 (1)The weighted average annual discount rate as of June 30, 2025 for operating leases was 4.50%. Based on this rate, the future lease payments above include imputed interest of $127,547. The weighted average remaining term of operating leases