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Commitments and Contingencies

9 Months Ended

Sep. 30, 2023

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

11. 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.

Operating Leases

For each of the below listed leases, management has determined it will utilize the base rental period and have not considered any renewal periods.

Schedule of Operating Lease

Location		Square Feet				Monthly Rent				Lease Expiry
Columbus, OH			6,000			$	5,100			December 31, 2028
Madison Heights, MI			36,000			$	43,185			August 31, 2026
Sterling Heights, MI			37,000			$	21,072			April 30, 2028
Traverse City, MI			5,200			$	4,500			January 31, 2024

Temporary space
Madison Heights, MI			3,200			$	1,605			month to month

Vehicles
various			n/a			$	2,708			September 30, 2028

The following table sets forth the future minimum lease payments under our leases:

For the twelve months ending September 30,		Finance Leases				Operating Leases
2024		$	67,358			$	916,353
2025			67,358				892,047
2026			63,306				855,585
2027			49,500				353,662
2028			37,228				238,947
Thereafter			-				17,550
Less Imputed Interest			(47,094	)			(429,243	)
Less Short-term lease payments			-				(4,814	)
Total		$	237,656			$	2,840,087

The following table summarizes the components of lease expense:

Summary of Components of Lease Expense

For the three months ending September 30,		2023				2022
Finance lease expense:
Amortization of ROU asset		$	13,221			$	-
Interest on lease liabilities			5,036				-
Operating lease expense			238,864				243,301
Short-term lease expense			4,814				4,814

For the nine months ending September 30,		2023				2022
Finance lease expense:
Amortization of ROU asset		$	28,181			$	-
Interest on lease liabilities			11,462				-
Operating lease expense			715,176				729,902
Short-term lease expense			14,441				14,441

The following tables set forth additional information pertaining to our leases:

For the nine months ending September 30,		2023				2022
Cash paid for amounts included in the measurement of lease liabilities:
Financing cash flows from finance leases (interest)		$	11,462			$	-
Financing cash flows from finance leases (principal)			23,167				-
Operating cash flows from operating leases			531,567				318,030
Weighted average remaining lease term – finance leases			4.4 years				-
Weighted average remaining lease term – operating leases			3.8 years				4.7 years
Weighted average discount rate – finance leases			8.88	%			-
Weighted average discount rate – operating leases			6.93	%			6.99	%

		September 30, 2023				December 31, 2022
Operating leases:
Right-of-use assets, operating		$	2,716,512			$	3,200,191
Lease liabilities, operating – current			713,638				692,074
Lease liabilities, operating – net of current			2,126,449				2,624,608
Total operating lease liabilities		$	2,840,087			$	3,316,682

Finance leases:
Right-of-use asset, finance		$	261,892			$	160,990
Accumulated amortization			(28,181	)			(6,708	)
Right-of-use asset, finance, net		$	233,711			$	154,282

Lease liabilities, finance – current		$	48,802			$	22,493
Lease liabilities, finance – net of current			188,854				133,131
Total finance lease liability		$	237,656			$	155,624