LEASES

9 Months Ended

Sep. 30, 2023

Leases

LEASES

8. LEASES

The Company has entered into operating leases primarily for office space. These leases have terms which range from two years to six years, and often include one or more options to renew or in the case of equipment rental, to purchase the equipment. During the nine months ended September 30, 2023, the Company did not record any additional right of use (“ROU”) assets or lease liabilities related to new operating leases.

The following table presents the future minimum payment obligations and aggregate present value of lease liabilities for operating leases as of September 30, 2023:

Remainder of 2023	$	93,253
2024		269,487
2025		270,507
2026		219,735
2027		230,724
Thereafter		–
Total future lease payments		1,083,706
Less: Imputed interest		(225,687	)
Present value of lease liabilities	$	858,019

These operating leases are listed as separate line items on the Company's Consolidated Balance Sheets and represent the Company’s right to use the underlying asset for the lease term. The Company’s obligation to make lease payments are also listed as separate line items on the Company's Consolidated Balance Sheets.

Because the rate implicit in each lease is not readily determinable, the Company uses its incremental borrowing rate to determine the present value of the lease payments.

Information related to the Company's operating ROU assets and related lease liabilities are as follows:

	Nine Months Ended September 30, 2023
Cash paid for operating lease liabilities	$	283,678
Weighted-average remaining lease term		2.7
Weighted-average discount rate		10%

For the three months ended September 30, 2023 and 2022, the Company recorded rent expenses related to lease obligations of $97,693 and $109,829, respectively. For the nine months ended September 30, 2023 and 2022, the Company recorded rent expenses related to lease obligations of $297,897 and $330,462, respectively. Rent expenses related to lease obligations are allocated between cost of goods sold and selling, general and administrative expenses in the Company’s condensed consolidated statement of operations.