Commitments and Contingencies

9 Months Ended

Sep. 30, 2022

Commitments and Contingencies Disclosure [Abstract]

Leases

The table below summarizes the components of lease expense and income statement location for the three and nine months ended September 30, 2022 and 2021:


	Line Item in the Company’s Condensed Consolidated Income Statements	Three Months Ended September 30, 2022		Three Months Ended September 30, 2021		Nine Months Ended September 30, 2022		Nine Months Ended September 30, 2021
Finance lease costs:
Amortization of assets	Depreciation and amortization	$	7,570	$	21,797	$	48,001	$	63,506
Interest on lease liabilities	Other expense, net	1,015		2,132		3,564		7,225
Total finance lease costs		8,585		23,929		51,565		70,731
Operating lease costs	General and administrative expenses	1,426,010		$	1,201,547	4,138,801		$	3,221,145
Total lease costs		$	1,434,595	$	1,225,476	$	4,190,366	$	3,291,876

Supplemental information and balance sheet location related to leases (excluding amounts related to leases classified as held for sale) is as follows:


	September 30, 2022		December 31, 2021
Operating Leases:
Operating lease right-of -use asset	$19,046,081		$18,425,914
Operating lease liability - current portion	$4,969,470		$4,613,843
Operating lease liability - net of current portion	17,427,096		16,872,093
Total operating lease liability	$22,396,566		$21,485,936
Finance Leases:
Property and equipment, at cost	$151,396		$267,252
Less accumulated amortization	(80,083)		(147,937)
Property and equipment, net	$71,313		$119,315
Finance lease liability - current portion	24,175		49,855
Finance lease liability - net of current portion	69,713		87,939
Total finance lease liabilities	$93,888		$137,794
Weighted average remaining lease term (in years):
Operating leases	5.4		5.4
Finance lease	3.6		3.6
Weighted average discount rate:
Operating leases	4.5	%	4.6	%
Finance leases	4.3	%	4.8	%

Supplemental cash flow information related to leases is as follows:


	Nine Months Ended September 30, 2022		Nine Months Ended September 30, 2021
Cash paid for amounts included in measurement of liabilities:
Operating cash flows from operating leases	$	4,309,229	$	3,069,797
Operating cash flows from finance leases	3,564		7,225
Financing cash flows from finance leases	43,907		59,285

Non-cash transactions: ROU assets obtained in exchange for lease liabilities
Operating lease	$	4,402,229	$	6,232,875
Finance lease	—		15,140

Maturities of lease liabilities as of September 30, 2022 were as follows:


	Operating Leases		Finance Lease
2022 (remainder)	$	1,520,692	$	6,900
2023	5,661,042		27,600
2024	5,051,926		27,600
2025	4,589,077		27,600
2026	2,768,973		11,500
Thereafter	5,537,408		—
Total lease payments	$	25,129,118	$	101,200
Less: Imputed interest	(2,732,552)		(7,312)
Total lease obligations	22,396,566		93,888
Less: Current obligations	(4,969,470)		(24,175)
Long-term lease obligation	$	17,427,096	$	69,713

During the second quarter of 2022, the Company entered into various operating leases that have not yet commenced for spaces to be used by the Company’s new corporate clinics. These leases are expected to result in additional ROU assets and liabilities of approximately $1.5 million. These leases are expected to commence during the last quarter of 2022 and the first quarter of 2023, with lease terms of five to ten years.

Guarantees in Connection with the Sale of the Divested Business

In connection with the sale of a corporate managed clinic, the Company guaranteed a future operating lease commitment assumed by the buyer. The Company is obligated to perform under the guarantee if the buyer fails to perform under the lease agreement at any time during the remainder of the lease agreement, which expires on May 31, 2027. As of September 30, 2022, the undiscounted maximum potential future payments under the lease guarantee were $247,296. During the nine months ended September 30, 2022, the buyer had performed under the lease agreement. The Company has not recorded a liability with respect to the guarantee obligation as of September 30, 2022, as the Company concluded that payment under the lease guarantee was not probable.

Litigation

In the normal course of business, the Company is party to litigation and claims from time to time. The Company maintains insurance to cover certain litigation and claims.