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LEASES

12 Months Ended

Dec. 31, 2023

10.

LEASES

The Company leases manufacturing and office space under an agreement classified as an operating lease. On November 10, 2022, the Company executed the second amendment to the lease agreement for its manufacturing and office space, which extends the lease agreement’s expiration date to April 30, 2026. The lease agreement does not include any renewal options. The agreement provides for an initial monthly base amount plus annual escalations through the term of the lease. In addition to the monthly base amounts in the lease agreement, the Company is required to pay real estate taxes and operating expenses during the lease terms.

The Company also leases office equipment in agreements classified as operating leases.

For the years ended December 31, 2023 and 2022, the Company’s operating lease expense was $2,142,338 and $2,101,596, respectively.

Future minimum lease payments under non-cancellable operating leases as of December 31, 2023 were as follows:

Year ending December 31,
2024	$	2,228,784
2025		2,283,354
2026		850,276
2027		111,065
2028		9,226
Total undiscounted operating lease payments		5,482,705
Less imputed interest		(383,076	)
Present value of operating lease payments	$	5,099,629

The following table sets forth the ROU assets and operating lease liabilities as of December 31, 2023 and 2022:

	2023		2022
Assets
ROU assets, net	$	4,740,193	$	6,526,627

Liabilities
Current operating lease liabilities	$	1,999,058	$	1,817,811
Long-term operating lease liabilities		3,100,571		5,077,235
Total lease liabilities	$	5,099,629	$	6,895,046

The Company’s weighted average remaining lease term for its operating leases is 2.5 years as of December 31, 2023. The Company’s weighted average discount rate for its operating leases is 5.43% as of December 31, 2023.