Company: WKSP
Filing Date: 2025-11-13
Form Type: 10-Q
Source: 0001493152-25-022113
Chunk: 21

Company: Worksport Ltd
Filing Date: 2025-11-13
Form: 10-Q
Item: Part I, Item 1
Chunk 21
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 interest on the GIC at maturity is $1,270.

    13

12.
Leases

The
Company accounts for leases under Accounting Standards Codification (“ASC”) 842, Leases, whereby it recognizes a lease liability and a right-of-use asset. The
lease liability is measured at the present value of the remaining lease payments, discounted by the Company’s incremental
borrowing rate. The Company measured the right of use asset at an initial amount equal to the lease liability.

During
the year ended December 31, 2023, the Company signed a lease agreement for office space to be used as an R&D facility pursuant to
a one-year lease with an option to extend the lease for an additional year, dated June 1, 2023, for a monthly rent of $3,350. The lease
was renewed effective June 1, 2024 at a rate of $3,600 per month with a termination date of May 31, 2025. The lease was not renewed.
The Company’s incremental borrowing rate used to  initially measure the present value of the remaining lease payments
was 10%.

On
April 1, 2025, the Company signed a lease agreement for 12,500 square feet of office space to be used as a R&D facility pursuant
to a three-year lease with an option to extend the lease for an additional two years. The lease was effective on May 1, 2025 at a
rate of $9,659 per month with a termination date of April 30, 2028. The Company’s incremental borrowing rate used to initially
measure the present value of the remaining lease payments was 15%. 

On
July 14, 2025, the Company signed a lease agreement for 1,992
square feet of office space to be used as an R&D facility for its Terravis Energy subsidiary pursuant to a two-year
lease effective July 18, 2025 for an average monthly rent of $3,154.
The Company’s incremental borrowing rate used to initially measure the present value of the remaining lease payments was 15%.

The
Company’s right-of-use asset and lease liability as of September 30, 2025, and December 31, 2024, are as follows:

Schedule Right-of-use Asset 

    September 30, 2025  
    December 31,
                                                                               2024 
  
    Right-of-use asset 
    $299,376