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OPERATING LEASE RIGHT-OF-USE ASSETS
 9 Months Ended
Sep. 30, 2023
Operating Lease Right-of-use Assets  
OPERATING LEASE RIGHT-OF-USE ASSETS

NOTE 17 – OPERATING LEASE RIGHT-OF-USE ASSETS

 

The Company’s right-of-use assets represent arrangements related primarily to office facilities used in the ordinary business operations of the Company and its subsidiaries. In April, 2018, a commercial bank issued an irrevocable standby letter of credit on behalf of the Company to the landlord for $1,075,000 to lease office space. The standby letter of credit was valid for a one-year term and was amended in January 2021 to extend to January 31, 2026. As of September 30, 2023 and December 31, 2022, the Company’s net operating lease right-of-use assets amounted to $2,738,554 and $3,606,398, respectively. The Company had variable lease payments of approximately $58,071 and $22,713 during the three months ended September 30, 2023 and 2022, respectively. Variable lease payments were $97,875 and $49,730 during the nine months ended September 30, 2023 and 2022, respectively, which consisted primarily of common area maintenance charges and administrative fees. During the nine months ended September 30, 2022 the Company terminated one of its lease contracts and recognized a gain on the lease termination of $122,533. There was no such termination during the nine months ended September 30, 2023. The effect of the termination on the related lease asset and liability were as follows:

 

   Right of   Accumulated   Lease Liability   Gain on 
   Use Asset   Amortization   Current   Long Term   Termination 
Lease Terminations  $(1,301,571)  $907,370   $442,704   $74,030   $122,533 

 

Operating lease costs included in the general and administrative expenses in our condensed consolidated statements of operations and comprehensive income (loss) for the three and nine months ended September 30, 2023 and 2022, are as follows:

 

   2023   2022   2023   2022 
   For the three months ended September 30,   For the nine months ended September 30, 
   2023   2022   2023   2022 
Operating lease costs  $419,605   $397,428   $1,198,467   $1,213,386 

 

Supplemental information related to operating leases for lease liabilities as of September 30, 2023 and September 30, 2022 is as follows:

 

   2023   2022 
Cash paid for amounts included in the measurement of lease liabilities  $1,155,759   $1,120,111 
Weighted average remaining lease term   2.2 years    3.2 years 
Weighted average discount rate   5.00%   5.00%

 

Future undiscounted lease payments for operating leases and a reconciliation of these payments to our operating lease liabilities as of September 30, 2023 are as follows:

 

Years ending December 31,  Future lease payments   Imputed Interest Amount   Lease Liabilities 
Remainder of 2023  $393,129   $37,978   $355,151 
2024   1,610,844    105,810    1,505,034 
2025   1,453,785    28,290    1,425,495 
Thereafter   —    —    — 
Total future lease payments  $3,457,758   $172,078   $3,285,680