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Commitments and Contingencies | 6 Months Ended
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Jun. 30, 2021
Commitments and Contingencies Disclosure [Abstract] |
Commitments and Contingencies | 12. Commitments and Contingencies From time to time we are involved in legal proceedings, claims and litigation related to employee claims, contractual disputes and taxes in the ordinary course of business. Although we cannot predict the outcome of such matters, currently we have no reason to believe the disposition of any current matter could reasonably be expected to have a material adverse impact on our financial position, results of operations or the ability to carry on any of our business activities. Employment Agreements We have entered into employment agreements with three of our key executives, including one of our founders. Under their respective employment agreements, the executives are employed on an “at-will” basis and are bound by typical confidentiality, non-solicitation and non-competition provisions. Deferred compensation for one founder remains outstanding as of June 30, 2021. Operating Leases On January 1, 2010, we entered into an agreement to lease 6,000 rentable square feet of office space in Columbus, Ohio. The lease commenced on January 1, 2010 and, pursuant to a lease extension dated August 9, 2016, the lease expires on December 31, 2021. We are currently evaluating renewal options. Our subsidiary, Graphic Sciences, uses 36,000 square feet of leased space in Madison Heights, Michigan as its main facility. Graphic Sciences uses about 20,000 square feet for its records storage services, with the remainder of the space used for production, sales, and administration. The monthly rental payment is $41,508, with gradually higher annual increases each September up to $45,828 for the final year, and with a lease term continuing until August 31, 2026. Graphic Sciences also leases and uses a separate 20,000 square foot building for document storage in Highland Park, Michigan, and a satellite office in Traverse City, Michigan for production. The monthly Highland Park rental payment is $11,250, with a lease term continuing until September 30, 2021. The monthly Traverse City rental payment is $4,500, with a lease term continuing until January 31, 2024. Graphic Sciences also leases and uses four leased vehicles for logistics. The monthly rental payments for these vehicles total $2,618, with lease terms continuing until October 31, 2024. Graphic Sciences also leases and uses an additional temporary storage space in Madison Heights, with a monthly rental payment of $1,605 and a lease term on a month-to-month basis. We have made an accounting policy election to not record a right-of-use asset and lease liability for short-term leases, which are defined as leases with a lease term of 12 months or less. Instead, the lease payments are recognized as rent expense in the general and administrative expenses on the statement of operations. During 2021, we signed a lease for 37,000 square foot building, primarily for document storage, in Sterling Heights, Michigan, with monthly rental payments of $20,452 commencing on May 1, 2021, with gradually higher annual increases each May up to $24,171 for the final year, and with a lease term continuing to April 30, 2028. The following table sets forth the future minimum lease payments under these operating leases: Schedule of Future Rental Payments for Operating Leases
For the period ending June 30, |  | Amount |
2022 |  | $ | 954,935 |
2023 |  |  | 871,294 |
2024 |  |  | 848,274 |
2025 |  |  | 812,086 |
2026 |  |  | 824,564 |
Thereafter |  |  | 617,218 |
Future lease payments under operating lease |  | $ | 4,928,371 |
Lease costs charged to operations for the three months ended June 30, 2021 and 2020 amounted to $260,907 and $217,570, respectively, and for the six months ended June 30, 2021 and 2020 amounted to $498,982 and $294,620, respectively. Included in the lease costs for the three and six months ended June 30, 2021 were short-term lease costs of $17,314 and $56,418, respectively. The following table sets forth additional information pertaining to our leases: Schedule of Operating Lease Costs
For the Six Months Ending June 30, 2021: |  |  |
Operating cash flows from operating leases |  | $ | 371,894 |
Weighted average remaining lease term – operating leases |  |  | 5.6 years |
Weighted average discount rate – operating leases |  |  | 7.1 | %
Because these leases do not provide an implicit rate, we use an incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. Warehouse Equipment Financing During the six months ended June 30, 2021, we committed to purchase warehouse racking in the amount of $351,854, of which $300,276 was purchased as of June 30, 2021.

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