Lease

9 Months Ended

Sep. 30, 2022

Lease

Lease

Note 11. Lease

Beginning on August 1, 2016, the Company leased its headquarters facility under an operating lease agreement that was scheduled to expire on June 30, 2022. Rent expense was $80,000 annually during the first year of the lease term and increased by 1.5% annually thereafter.  The lease was terminated one month early, and a new lease agreement, at the existing headquarters location, commenced on June 1, 2022.  The term of the new lease agreement is 84 months.  The first year’s rent will be $118,487 and will increase by 2% annually thereafter.

Supplemental balance sheet information related to the leases on September 30, 2022 and December 31, 2021 is as follows:

Description	Classification	September 30, 2022			December 31, 2021
Right of Use Asset - Lease, net	Other assets (non-current)	$	664,980		$	41,490
Operating Lease Liability - Short Term	Accrued liabilities		74,911			42,347
Operating Lease Liability - Long Term	Other long-term liabilities		592,521			0
Total Operating Lease Liability		$	667,432		$	42,347
Discount Rate - Operating Lease			7.0	%		6.0	%