Correction of an Error

9 Months Ended

Sep. 30, 2022

Correction Of An Error Abstract

Correction of an Error

Note 6 – Correction of an Error

During the review of the Company’s condensed consolidated financial statements for the three and nine month periods ended September 30, 2022, the Company identified errors in the reporting of historical stock-based compensation (included in general and administrative expenses) and leasehold amortization expense (included in depreciation and amortization). The errors resulted in an understatement of general and administrative expenses and overstatement of depreciation and amortization for the year-ended December 31, 2021 and an overstatement of both general administrative expense and depreciation and amortization expense for the three months ended March 31, 2022, and the three and six months ended June 30, 2022. Based on management’s evaluation of the SEC Staff’s Accounting Bulletins Nos. 99 (“SAB 99”) and 108 (“SAB 108”) and interpretations therewith, the Company concluded that the aforementioned errors were not material to the Company’s previously filed 2022 and 2021 consolidated financial statements. This is further supported by the fact that all errors are of a non-cash nature, do not impact Adjusted EBITDA (earnings before income tax, depreciation and amortization, and stock-based compensation), and would not likely have materially impacted a reasonable investor’s opinion of the Company’s financial condition and results of operations.

Because the correction of these errors was not deemed to be material to the results for the nine-months ended September 30, 2022, to correct these errors, the Company recorded the corrections as out-of-period adjustments in the three-month period ended September 30, 2022. See the table below for the details of the corrections:

	For The Three Months Ended								For The Nine Months Ended
	September 30, 2022								September 30, 2022
	Before Adjustment		Adjustment			As Reported			Before Adjustment		Adjustment			As Reported
Condensed Consolidated Statements of Operations:
Stock-based compensation expense	$	91,250	$	147,590		$	238,840		$	593,155	$	200,074		$	793,229
Depreciation and amortization expense	$	638,046	$	(966,785	)	$	(328,739	)	$	1,932,630	$	(644,524	)	$	1,288,106
Net loss	$	2,461,426	$	(819,195	)	$	1,642,231		$	9,526,829	$	(444,450	)	$	9,082,379