XML 39 R16.htm IDEA: XBRL DOCUMENT v3.25.0.1
COMMITMENTS AND CONTINGENCIES
 12 Months Ended
Dec. 31, 2024
Commitments and Contingencies Disclosure [Abstract]  
COMMITMENTS AND CONTINGENCIES

NOTE 7: COMMITMENTS AND CONTINGENCIES

 

Litigation

 

From time to time, the Company could become involved in disputes and various litigation matters that arise in the normal course of business. These may include disputes and lawsuits related to intellectual property, licensing, contract law and employee relations matters. Periodically, the Company reviews the status of significant matters, if any exist, and assesses its potential financial exposure. If the potential loss from any claim or legal claim is considered probable and the amount of such potential loss can be estimated, the Company accrues liability for the estimated loss. Legal proceedings are subject to uncertainties, and the outcomes are difficult to predict. Because of such uncertainties, accruals are based on the best information available at the time. As additional information becomes available, the Company reassesses the potential liability related to pending claims and litigation.

 

Leases

 

On October 1, 2021, the Company entered into a noncancelable two-year operating lease agreement for approximately 2,000 square feet of office space in San Diego, California. The base rent was $7,999 per month with an increase of 3% after the first anniversary of the lease term commencement, which was November 1, 2022.

 

On April 19, 2023, the Company executed an amendment to the lease agreement to extend the lease through October 31, 2025. Accordingly, the Company remeasured its operating lease liability under the agreement and recognized an incremental lease liability and right-of-use asset of $236,506. The remeasurement was based on a 9% incremental borrowing rate.

 

 

Future minimum annual lease payments and a reconciliation to the Company’s operating lease liability under the Company’s noncancelable operating lease as of December 31, 2024 are as follows:

  

      
Total minimum lease payments in 2025  $86,862 
Less: amount representing interest   (2,698)
Present value of operating lease liability   84,164 
Less: current portion   (84,164)
Operating lease liability, net of current portion  $- 

 

The Company recognized rent expense of $101,847 and $100,742 during the years ended December 31, 2024 and 2023, respectively. Total cash payments for the operating lease totaled $101,705 and $99,254 during the years ended December 31, 2024 and 2023, respectively.