Quarterly report pursuant to Section 13 or 15(d)

Commitments and Contingencies

v3.23.3
Commitments and Contingencies
9 Months Ended
Sep. 30, 2023
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies Commitments and ContingenciesLeases
The table below summarizes the components of lease expense and income statement location for the three and nine months ended September 30, 2023 and 2022:
Line Item in the
Company’s Condensed Consolidated
Income Statements
Three Months Ended
September 30, 2023
Three Months Ended
September 30, 2022
Nine Months Ended
September 30, 2023
Nine Months Ended
September 30, 2022
Finance lease costs:
Amortization of assets Depreciation and amortization $ 7,570  $ 7,570  $ 22,709  $ 48,001 
Interest on lease liabilities Other expense, net 760  1,015  2,473  3,564 
Total finance lease costs 8,330  8,585  25,182  51,565 
Operating lease costs General and administrative expenses 1,633,469  $ 1,426,010  4,910,181  $ 4,138,801 
Total lease costs $ 1,641,799  $ 1,434,595  $ 4,935,363  $ 4,190,366 
Supplemental information and balance sheet location related to leases (excluding amounts related to leases classified as held for sale) is as follows:
September 30, 2023 December 31, 2022
Operating Leases:
Operating lease right-of -use asset $19,803,896 $20,587,199
Operating lease liability - current portion $5,392,944 $5,295,830
Operating lease liability - net of current portion 17,200,146 18,672,719
Total operating lease liability $22,593,090 $23,968,549
Finance Leases:
Property and equipment, at cost $151,396 $151,396
Less accumulated amortization (110,362) (87,652)
Property and equipment, net $41,034 $63,744
Finance lease liability - current portion 25,223 24,433
Finance lease liability - net of current portion 44,490 63,507
Total finance lease liabilities $69,713 $87,940
Weighted average remaining lease term (in years):
Operating leases 5.1 5.4
Finance lease 2.6 3.4
Weighted average discount rate:
Operating leases 5.1  % 4.8  %
Finance leases 4.3  % 4.3  %
Supplemental cash flow information related to leases is as follows:
Nine Months Ended
September 30, 2023
Nine Months Ended
September 30, 2022
Cash paid for amounts included in measurement of liabilities:
Operating cash flows from operating leases $ 5,263,092  $ 4,309,229 
Operating cash flows from finance leases 2,473  3,564 
Financing cash flows from finance leases 18,227  43,907 
Non-cash transactions: ROU assets obtained in exchange for lease liabilities
Operating lease $ 4,287,622  $ 4,402,229 
Finance lease —  — 
`
Maturities of lease liabilities as of September 30, 2023 were as follows:
Operating Leases Finance Lease
2023 (remainder) $ 1,633,006  $ 6,900 
2024 6,236,923  27,600 
2025 5,592,674  27,600 
2026 3,979,181  11,500 
2027 3,099,193  — 
Thereafter 5,193,199  — 
Total lease payments $ 25,734,176  $ 73,600 
Less: Imputed interest (3,141,086) (3,887)
Total lease obligations 22,593,090  69,713 
Less: Current obligations (5,392,944) (25,223)
Long-term lease obligation $ 17,200,146  $ 44,490 
All leases entered into by the Company have commenced as of September 30, 2023.
Guarantee in Connection with the Sale of the Divested Business
In connection with the sale of a company-managed clinic in 2022, the Company guaranteed one future operating lease commitment assumed by the buyers. The Company is obligated to perform under the guarantee if the buyers fail to perform under the lease agreement at any time during the remainder of the lease agreement, which expires on May 31, 2027. At the date of sale, the undiscounted maximum potential future payments totaled $247,296. As of September 30, 2023, the undiscounted remaining lease payments under the agreement totaled $196,896. The Company had not recorded a liability with respect to the guarantee obligation as of September 30, 2023, as the Company concluded that payment under the lease guarantee was not probable.
Litigation
In the normal course of business, the Company is party to litigation and claims from time to time. The Company maintains insurance to cover certain litigation and claims.