Annual report pursuant to Section 13 and 15(d)

Leases

Leases

12 Months Ended

Dec. 31, 2022

Our leases principally consist of operating leases related to our corporate office, field offices, and our research, manufacturing and storage facilities. Our lease terms do not include options to extend or terminate the lease until we are reasonably certain that we will exercise that option.

Some of our lease arrangements contain lease components (e.g. minimum rent payments) and non-lease components (e.g. maintenance, labor charges, etc.). We account for each component separately based on the estimated standalone price of each component.

Operating leases are included in Right-of-use assets, Lease obligations, current and Lease obligations, long term on the consolidated balance sheets. These assets and liabilities are recognized at the commencement date based on the present value of remaining lease payments over the lease term using an incremental borrowing rate consistent with the lease terms or implicit rates, when readily determinable. Short-term operating leases, which have an initial term of 12 months or less, are not recorded on the balance sheet.

Lease expense for operating leases, which principally consists of fixed payments for base rent, is recognized on a straight-line basis over the lease term. Lease expense for the years ended December 31, 2022 and 2021 was $811,664 and $802,409, respectively.

Supplemental information related to operating leases for the years ended December 31, 2022 and 2021 was as follows:


	December 31, 2022			December 31, 2021
Cash paid for amounts included in the measurement of operating lease liabilities	$	733,284		$	715,639
Right-of-use assets obtained in exchange for operating lease liabilities	$	—		$	825,848
Weighted-average remaining lease term - operating leases	3.6 Years			4.0 Years
Weighted-average discount rate - operating leases	6.0		%	6.0		%

Supplemental balance sheet information related to operating leases for the years ended December 31, 2022 and 2021 was as follows:


	December 31, 2022		December 31, 2021
Operating leases
Right-of-use assets	$	1,245,549	$	1,869,210

Operating lease liability, current	$	687,589	$	641,002
Operating lease liability, long-term	623,452		1,315,275
Total operating lease liability	$	1,311,041	$	1,956,277

Future minimum lease commitments under non-cancellable operating leases as of December 31, 2022 were as follows:


	Operating Leases
2023	$	742,158
2024	249,681
2025	123,908
2026	111,260
2027	52,765
Thereafter	171,086
Total lease payments	1,450,858
Less: imputed interest	139,817
Total	$	1,311,041