Quarterly report pursuant to Section 13 or 15(d)

Commitments and Contingencies

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Commitments and Contingencies
 3 Months Ended
Mar. 31, 2024
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies Commitments and Contingencies
Leases
The table below summarizes the components of lease expense and income statement location for the three months ended March 31, 2024 and 2023:
Line Item in the
Company’s Condensed Consolidated
Income Statements		 Three Months Ended
March 31, 2024
Three Months Ended
March 31, 2023
Finance lease costs:
Amortization of assets Depreciation and amortization $ 7,570  $ 7,570 
Interest on lease liabilities Other income, net 628  889 
Total finance lease costs 8,198  8,459 
Operating lease costs General and administrative expenses 1,001,343  1,588,941 
Total lease costs $ 1,009,541  $ 1,597,400 
Supplemental information and balance sheet location related to leases (excluding amounts related to leases classified as held for sale) is as follows:
March 31, 2024 December 31, 2023
Operating Leases:
Operating lease right-of -use asset $12,214,619 $12,413,221
Operating lease liability - current portion $3,750,477 $3,756,328
Operating lease liability - net of current portion 10,606,889 10,914,997
Total operating lease liability $14,357,366 $14,671,325
Finance Leases:
Property and equipment, at cost $151,397 $151,396
Less accumulated amortization (125,501) (117,932)
Property and equipment, net $25,896 $33,464
Finance lease liability - current portion 25,763 25,491
Finance lease liability - net of current portion 31,471 38,016
Total finance lease liabilities $57,234 $63,507
Weighted average remaining lease term (in years):
Operating leases 4.7 4.8
Finance lease 2.1 2.4
Weighted average discount rate:
Operating leases 5.5  % 5.4  %
Finance leases 4.3  % 4.3  %
Supplemental cash flow information related to leases is as follows:
Three Months Ended March 31, 2024 Three Months Ended March 31, 2023
Cash paid for amounts included in measurement of liabilities:
Operating cash flows from operating leases $ 1,152,599  $ 1,695,098 
Operating cash flows from finance leases 628  889 
Financing cash flows from finance leases 6,272  6,011 
Non-cash transactions: ROU assets obtained in exchange for lease liabilities
Operating lease $ 353,238  $ 2,247,839 
Finance lease —  — 
Maturities of lease liabilities as of March 31, 2024 are as follows:
Operating Leases Finance Lease
2024 (remainder) $ 3,335,215  $ 20,699 
2025 4,147,189  27,600 
2026 2,851,199  11,500 
2027 2,126,668  — 
2028 1,307,851  — 
Thereafter 2,529,735  — 
Total lease payments $ 16,297,857  $ 59,799 
Less: Imputed interest (1,940,491) (2,565)
Total lease obligations 14,357,366  57,234 
Less: Current obligations (3,750,477) (25,763)
Long-term lease obligation $ 10,606,889  $ 31,471 
During the last quarter of 2023, the Company entered into one operating lease that has not yet commenced for a space to be used by the Company’s new corporate clinics. The lease is expected to result in additional ROU assets and liabilities of approximately $0.6 million. The lease is expected to commence during the second or the third quarter of 2024, with a lease term of five to ten years.
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 March 31, 2024, the undiscounted remaining lease payments under the agreement totaled $171,696. The Company had not recorded a liability with respect to the guarantee obligation as of March 31, 2024, 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.