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Commitments and Contingencies
 9 Months Ended
Sep. 30, 2024
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies

9. 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.

 

Location  Square Feet   Monthly Rent   Lease Expiry
Columbus, OH   6,000   $5,250   December 31, 2028
Madison Heights, MI   36,000   $44,930   August 31, 2026
Sterling Heights, MI   37,000   $22,312   April 30, 2028
Traverse City, MI   5,200   $5,100   January 31, 2026
              
Temporary space             
Madison Heights, MI   3,200   $1,605   month to month
              
Vehicles             
various   n/a    $6,284   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 
2025  $89,954   $974,719 
2026   85,902    892,644 
2027   63,855    366,156 
2028   68,064    238,947 
2029   13,181    17,550 
Less imputed interest   (51,375)   (248,919)
   $269,581   $2,241,097 

 

 

The following table summarizes the components of lease expense:

 

For the three months ending September 30,  2024   2023 
Finance lease expense:          
Amortization of ROU asset  $18,186   $13,221 
Interest on lease liabilities   6,580    5,036 
Operating lease expense   239,189    238,864 
Short-term lease expense   4,814    4,814 

 

For the nine months ending September 30,  2024   2023 
Finance lease expense:          
Amortization of ROU asset  $53,140   $28,181 
Interest on lease liabilities   20,006    11,462 
Operating lease expense   708,666    715,176 
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,  2024   2023 
Cash paid for amounts included in the measurement of lease liabilities:          
Financing cash flows from finance leases (interest)  $20,006   $11,462 
Financing cash flows from finance leases (principal)   45,577    23,167 
Operating cash flows from operating leases   582,486    531,567 
ROU assets obtained in exchange for new finance lease liabilities   89,289    107,610 
Weighted average remaining lease term – finance leases   3.8 years    4.4 years 
Weighted average remaining lease term – operating leases   2.8 years    3.8 years 
Weighted average discount rate – finance leases   9.72%   8.88%
Weighted average discount rate – operating leases   6.93%   6.93%