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Commitments and Contingencies
 6 Months Ended
Dec. 31, 2024
Commitments and Contingencies [Abstract]  
Commitments and Contingencies
14.Commitments and Contingencies

 

Legal Proceedings

 

From time to time, the Company may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties and an adverse result in these or other matters may arise from time to time that may harm our business. The Company is aware of one legal claim and has accrued approximately $108,000 for such claim.

 

On August 20, 2024, the Company’s former Chief Executive Officer, Matthew Atkinson, filed a lawsuit against the Company in the State of Nebraska claiming compensation, unreimbursed expenses and accrued and unpaid vacation owed to him prior to his resignation in February 2024.

 

The Company is currently not aware of any other such legal proceedings or claims that it believes will have a material adverse effect on its business, financial condition or operating results.

 

Leases

 

The Company has a non-cancellable operating lease commitment for its office facility expiring in 2028. Rent expense totaled $40,416 and $28,813 for the three months ended December 31, 2024 and 2023, respectively, $80,832 and $57,626 for the six months ended December 31, 2024 and 2023, respectively.

 

The following table discloses the lease cost, discount rate, and remaining lease term for operating leases as of December 31, 2024 and 2023:

 

   December 31,
2024		   December 31,
2023		 
Operating lease cost  $80,832   $57,626 
Remaining lease term   3.2 years    4.2 years 
Discount rate   6.56%   6.00%

 

The discount rate was determined using the Company’s external debt and was adjusted for collateralization, term and lease amount.

 

The following table discloses the undiscounted cash flows on an annual basis and a reconciliation of the undiscounted cash flows of operating lease liabilities recognized in the balance sheet as of December 31, 2024:

 

Year Ended June 30,      
2025 (remainder)   $ 82,247  
2026     167,226  
2027     171,407  
2028     116,160  
Total undiscounted cash flows     537,040  
Less amount representing interest     (51,246 )
Present value of lease liabilities     485,794  
Less current portion     (138,321 )
Noncurrent lease liabilities   $ 347,474