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Commitments and Contingencies | 12 Months Ended
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Dec. 31, 2024
Commitments and Contingencies [Abstract] |
Commitments and Contingencies |
(5) | Commitments and Contingencies
| (a) | Operating Leases
As of December 31, 2024, the Company has the right of use for its facilities located in Suwanee, GA under a long-term operating lease agreement, as amended (Lease Agreement), which expires in April 2029. The Company has the option (Extension Option) to extend the term for one consecutive term of five years each at the greater of the then current prevailing rental rate or current base rent rate, as agreed by both parties, and upon certain terms and conditions. The Company must provide written notice of its intent to exercise this extension option at between nine and 12 months prior to the expiration date of April 2029. Under the terms of the lease agreement, the Company’s monthly rent is subject to increases on an annual basis. As of December 31, 2024, the Company’s monthly rent payment was $50,590. Operating right-of-use assets and lease liabilities consist of the following as of December 31:
|  | 2024 |  |  | 2023 |
Lease right-of-use assets |  | $ | 1,805,543 |  |  |  | 2,380,225 |
Lease liabilities: |  | 2024 |  |  | 2023 |
Lease liabilities – current portion |  | $ | 517,967 |  |  |  | 406,636 |
Lease liabilities – long-term portion |  |  | 1,518,100 |  |  |  | 2,036,067 |
Total |  | $ | 2,036,067 |  |  |  | 2,442,703 |
As of December 31, 2024 and 2023, the weighted average discount rate for all operating leases with initial terms of more than one year was approximately 10% and the weighted average remaining term for operating leases was 4.3 years and 5.3 years, respectively. The operating lease agreement for the Company’s facility includes non-lease costs, such as common area maintenance, which are recorded as variable lease costs. Operating lease expenses are included in general and administrative expenses in the Company’s statements of comprehensive loss and are summarized as follows for the years ending December 31:
Lease cost: |  | 2024 |  |  | 2023 |
Operating lease cost |  | $ | 619,796 |  |  |  | 469,995 |
Short-term lease cost |  |  | 7,765 |  |  |  | 6,917 |
Variable lease cost |  |  | 148,109 |  |  |  | 78,367 |
Total |  | $ | 775,670 |  |  |  | 555,279 |
The following table summarizes the Company’s undiscounted cash payment obligations for its operating lease liabilities with initial terms of more than twelve months as of December 31, 2024:
Operating leases: |  |  |
2025 |  | $ | 629,340 |
2026 |  |  | 654,514 |
2027 |  |  | 680,694 |
2028 |  |  | 707,922 |
2029 |  |  | 243,835 |
Total undiscounted lease payments -operating leases |  |  | 2,916,305 |
Less: imputed interest |  |  | (880,238 | )
Lease liability |  |  | 2,036,067 |
Less: current portion of lease liability |  |  | (517,967 | )
Lease liability, less current portion |  | $ | 1,518,100 |
| (b) | Clinical Trial Agreements (CTAs)
As part of the regulatory approval process for taking its products to market or conducting post-market clinical studies to support marketing efforts for products with regulatory clearance, the Company enters into a CTA to compensate each participating medical institution and investigator. Generally, upon executing a CTA with a participating medical institution or investigator, the Company pays a fee for institutional review board (IRB) approval that usually requires annual renewals and one-time site startup costs. As individual participants are enrolled in the clinical trial by the participating medical institution or investigator, the Company pays certain per subject fees according to the CTA for the duration of the trial. Expenses incurred in connection with these CTA activities are expensed as services are provided and are included in research and development expenses on the accompanying statements of comprehensive loss.
| (c) | Legal Claims
Occasionally, the Company may be a party to legal claims or proceedings of which the outcomes are subject to significant uncertainty. In accordance with ASC 450, Contingencies, the Company will assess the likelihood of an adverse judgment for any outstanding claim as well as ranges of probable losses. When it has been determined that a loss is probable and the amount can be reasonably estimated, the Company will record a liability. For the years ended December 31, 2024 and 2023, there were no material legal contingencies requiring accrual or disclosure. The Company, as permitted under Delaware law and in accordance with its bylaws, indemnifies its officers and directors for certain events or occurrences, subject to certain limits, while the officer or director who is or was serving at the Company’s request in such capacity. The Company entered into employment agreements with its officers, which provides for indemnification protection in the executive’s capacity as an officer for actions taken within the scope of employment. The maximum amount of potential future indemnification is unlimited; however, the Company has obtained director and officer insurance that limits its exposure. The Company believes the fair value for these indemnification obligations is minimal. Accordingly, the Company has not recognized any liabilities relating to these obligations as of December 31, 2024 and 2023.

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