Company: IIIV
Filing Date: 2025-02-07
Form Type: 10-Q
Source: 0001728688-25-000043
Chunk: 66

Company: i3 Verticals, Inc.
Filing Date: 2025-02-07
Form: 10-Q
Item: Part I, Item 1
Chunk 66
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 addition to these amounts.

11. LEASES

The Company’s leases consist primarily of real estate leases throughout the markets in which the Company operates. At contract inception, the Company determines whether an arrangement is or contains a lease, and for each identified lease, evaluates the classification as operating or financing. The Company had no finance leases as of December 31, 2024. Leased assets and obligations are recognized at the lease commencement date based on the present value of fixed lease payments to be made over the term of the lease. Renewal and termination options are factored into determination of the lease term only if the option is reasonably certain to be exercised. The weighted-average remaining lease term at December 31, 2024 and 2023 were both 2 years. The Company had no significant short-term leases during the three months ended December 31, 2024 and 2023. The Company’s leases do not provide a readily determinable implicit interest rate and the Company uses its incremental borrowing rate to measure the lease liability and corresponding right-of-use asset. The incremental borrowing rates were determined based on a portfolio approach considering the Company’s current secured borrowing rate adjusted for market conditions and the length of the lease term. The weighted-average discount rate used in the measurement of our lease liabilities was 7.9% and 7.6% as of December 31, 2024 and 2023, respectively. Operating lease cost is recognized on a straight-line basis over the lease term. Operating lease costs from continuing operations were $972 for the three months ended December 31, 2024 and $1,036 for the three months ended December 31, 2023, which are included in selling, general and administrative expenses in the condensed consolidated statements of operations.Total operating lease costs from continuing operations include variable lease costs of approximately $26 for the three months ended December 31, 2024, and $10 for the three months ended December 31, 2023, which are primarily comprised of costs of maintenance and utilities and changes in rates, and are determined based on the 

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i3 VERTICALS, Inc.NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)(in thousands, except unit, share and per share amounts)

actual costs incurred during the period. Variable payments are expensed in the period incurred and not included in the measurement of lease assets and liabilities. Short-term rent expense from continuing operations was $24 for the three months ended December