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Commitments and Contingencies | 12 Months Ended
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Dec. 31, 2021
Commitments and Contingencies Disclosure [Abstract] |
Commitments and Contingencies | Note 15. Commitments and Contingencies Leases In June 2019, the Company entered into a Sublease agreement with US Closer, LLC, whereby we agreed to lease approximately 12,061 square feet of office and manufacturing space located in South Salt Lake City, Utah. Pursuant to the Sublease, the sublease expired on December 31, 2020 and required a monthly lease payment of $6,633 plus other pass-through expenses as required under the Primary Lease. The Company renegotiated with the landlord to renew this lease as the primary tenant in January 2021 to lease this warehouse on a month-to-month basis. The lease may be terminated at any time or for any reason with a 30-day written notice to terminate. The January 2021 lease requires a monthly lease payment of $6,833 plus other pass-through expenses as required under the lease as long as the Company remains in the space. As a condition of the lease, we were required to provide a $6,965 security deposit. Commencing on September 15, 2019, the Company entered into a five-year lease with Jamboree Center 1 & 2 LLC covering approximately 6,961 square feet of office space in Irvine, CA. Under the terms of the lease agreement, we are required to make the following monthly lease payments: Year 1 $21,927, Year 2 $22,832, Year 3 $23,737, Year 4 $24,712, Year 5 $25,686. As a condition of the lease, we were required to provide a $51,992 security deposit. The right-of-use asset for operating leases as of December 31, 2021 and 2020 was $663,291 and $881,804. Rent expense for the year ended December 31, 2021 and 2020 was $292,410 and $187,343. The following table reconciles the undiscounted cash flows for the leases as of December 31, 2021 to the operating lease liability recorded on the balance sheet:
Schedule of lessee operating lease liability |  |  |  |
2022 |  | $ | 287,769 |
2023 |  |  | 299,466 |
2024 |  |  | 231,174 |
2025 |  |  | – |
Total undiscounted lease payments |  |  | 818,409 |
Less: Abatement of rents |  |  | – |
Less: Imputed interest |  |  | 96,531 |
Present value of lease payments |  | $ | 721,878 |
Operating lease liabilities, current |  | $ | 287,769 |
Operating lease liabilities, long-term |  | $ | 434,109 |
Weighted-average remaining lease term |  |  | 3 |
Weighted-average discount rate |  |  | 7.0% |
The discount rate is the Company’s incremental borrowing rate, or the rate of interest that the Company would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. Based on an assessment of the Company’s borrowings the incremental borrowing rate was determined to be 7%. Employment Agreements In September 2020, the Company entered into an employment agreement with the Chief Executive Officer and Chief Financial Officer, which provides for an annual base salary of $50,000 that provides for incremental increases upon the Company’s achievement of specific performance metrics up to $350,000. The employment agreement provides for a grant of a stock option to the Chief Executive Officer to purchase up to 166,667 shares of the Company’s common stock at an exercise price equal to 110% of the fair market value of the Company’s common stock on the date of grant. The stock option will vest after five years of continuous employment, subject to acceleration if terminated without cause or resigns for good reason. The agreement also provides for an annual bonus of up to 100% of the base salary based upon the achievement of certain performance goals established and approved by the Board of Directors.

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