XML 23 R12.htm IDEA: XBRL DOCUMENT
v3.23.3

Note 5 - Commitments and Contingencies | 9 Months Ended
--- | ---
Sep. 30, 2023
Notes to Financial Statements |
Commitments and Contingencies Disclosure [Text Block] | 5. Commitments and Contingencies Leases We have identified assets as the corporate office, warehouse, monitoring equipment and laboratory facilities over which we have control and obtain economic benefits fully and classified these as operating leases after assessing the terms under classification guidance. We have entered into several leases for trailers and carbon units with purchase option at the end of the term. We have concluded that it is reasonably certain that we would exercise the purchase option at the end of the term, hence the leases were classified as finance leases. All of our leases have remaining term of two years to fourteen years. We made an accounting policy election to keep leases with an initial term of 12 months or less off of the balance sheet. We will recognize those lease payments in the Consolidated Statements of Operations as we incur the expenses. When discount rates implicit in leases cannot be readily determined, the Company uses the applicable incremental borrowing rate at lease commencement to perform lease classification tests on lease components and measure lease liabilities and right-of-use (“ROU”) assets. The incremental borrowing rate used by the Company was based on weighted average baseline rates commensurate with the Company’s secured borrowing rate over a similar term. At each reporting period, when there is a new lease initiated, the rates established for that quarter will be used. On December 14, 2021, we entered into a real estate purchase agreements and lease disposition and development agreement with the City of Riverbank. We plan to utilize the purchased and leased properties, located at 5300 Claus Road in the city of Riverbank, California, for the construction of the Carbon Zero Facility. The lease commenced on April 1, 2022. The Company evaluated the lease in accordance with ASC 842 – Lease Accounting and classified the lease as a finance lease. The components of lease expense and sublease income were as follows:
|  | Three months ended September 30, |  |  | Nine months ended September 30, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Operating lease cost |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Operating lease expense |  | $ | 180 |  |  | $ | 159 |  |  | $ | 542 |  |  | $ | 506 |
Short term lease expense |  |  | 89 |  |  |  | 44 |  |  |  | 131 |  |  |  | 146 |
Variable lease expense |  |  | 26 |  |  |  | 23 |  |  |  | 70 |  |  |  | 68 |
Total operating lease cost |  | $ | 295 |  |  | $ | 226 |  |  | $ | 743 |  |  | $ | 720 |
Finance lease cost |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Amortization of right-of-use assets |  | $ | 30 |  |  | $ | 26 |  |  | $ | 91 |  |  | $ | 115 |
Interest on lease liabilities |  |  | 83 |  |  |  | 98 |  |  |  | 256 |  |  |  | 217 |
Total finance lease cost |  | $ | 113 |  |  | $ | 124 |  |  | $ | 347 |  |  | $ | 332 |
Cash paid for amounts included in the measurement of lease liabilities:
|  | Three months ended September 30, |  |  | Nine months ended September 30, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Operating cash flows used in operating leases |  | $ | 169 |  |  | $ | 184 |  |  | $ | 499 |  |  | $ | 522 |
Operating cash flows used in finance leases |  |  | 83 |  |  |  | 98 |  |  |  | 256 |  |  |  | 216 |
Financing cash flows used in finance leases |  | $ | 83 |  |  | $ | 132 |  |  | $ | 394 |  |  | $ | 314 |
Supplemental non-cash flow information related to ROU asset and lease liabilities was as follows for the three and nine months ended September 30, 2023 and 2022:
|  | Three months ended September 30, |  |  | Nine months ended September 30, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Operating leases |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Accretion of the lease liability |  | $ | 81 |  |  | $ | 83 |  |  | $ | 252 |  |  | $ | 262 |
Amortization of right-of-use assets |  |  | 100 |  |  |  | 76 |  |  |  | 291 |  |  |  | 244 |
The weighted average remaining lease term and weighted average discount rate as of September 30, 2023 are as follows: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Weighted Average Remaining Lease Term |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Operating leases (in years) |  |  | 4.5 |  |  |  |  |  |  |  |  |  |  |  |  |
Finance leases (in years) |  |  | 13.3 |  |  |  |  |  |  |  |  |  |  |  |  |
Weighted Average Discount Rate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Operating leases |  |  | 14.1 | % |  |  |  |  |  |  |  |  |  |  |  |
Finance leases |  |  | 13.2 | % |  |  |  |  |  |  |  |  |  |  |  |
Supplemental balance sheet information related to leases was as follows:
|  | September 30, 2023 |  |  | December 31, 2022 |
Operating leases |  |  |  |  |  |  |  |
Operating lease right-of-use assets |  | $ | 2,159 |  |  | $ | 2,449 |
Current portion of operating lease liability |  |  | 390 |  |  |  | 338 |
Long term operating lease liability |  |  | 1,890 |  |  |  | 2,189 |
Total operating lease liabilities |  |  | 2,280 |  |  |  | 2,527 |
Finance leases |  |  |  |  |  |  |  |
Property and equipment, at cost |  | $ | 2,889 |  |  | $ | 3,045 |
Accumulated depreciation |  |  | (198 | ) |  |  | (112 | )
Property and equipment, net |  |  | 2,691 |  |  |  | 2,933 |
Other current liability |  |  | - |  |  |  | 71 |
Other long term liabilities |  |  | 2,666 |  |  |  | 2,911 |
Total finance lease liabilities |  |  | 2,666 |  |  |  | 2,982 |
Maturities of operating lease liabilities were as follows:
Twelve months ended September 30, |  | Operating leases |  |  | Finance leases |
2024 |  | $ | 680 |  |  | $ | 204 |
2025 |  |  | 672 |  |  |  | 176 |
2026 |  |  | 648 |  |  |  | 145 |
2027 |  |  | 641 |  |  |  | 145 |
2028 |  |  | 436 |  |  |  | 145 |
Thereafter |  |  | - |  |  |  | 10,105 |
Total lease payments |  |  | 3,077 |  |  |  | 10,920 |
Less imputed interest |  |  | (797 | ) |  |  | (8,254 | )
Total lease liability |  | $ | 2,280 |  |  | $ | 2,666 |
The Company acts as sublessor in certain leasing arrangements, primarily related to land and buildings. Fixed sublease payments received are recognized on a straight-line basis over the sublease term. Sublease income and head lease expense for these transactions are recognized on a gross basis on the consolidated financial statements. This was recorded in the Selling, general and administrative expense section of the Consolidated Statements of Operations and Comprehensive Loss. The components of lease income were as follows:
|  | Three months ended September 30, |  |  | Nine months ended September 30, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Lease income |  | $ | 230 |  |  | $ | 429 |  |  | $ | 1,182 |  |  | $ | 429 |
Future lease commitments to be received by the Company as of September 30, 2023 were as follows:
Twelve months ended September 30, |  |  |  |
2024 |  | $ | 806 |
2025 |  |  | 729 |
2026 |  |  | 569 |
2027 |  |  | 474 |
2028 |  |  | 474 |
Thereafter |  |  | 711 |
Total future lease commitments |  | $ | 3,763 |
Legal Proceedings The Company is subject to legal proceedings and claims which arise in the ordinary course of its business. While the ultimate outcome of these matters is not presently determinable, it is in the opinion of management that the resolution of outstanding claims will not have a material adverse effect on the financial position or results of operations of the Company. The Company's view of the matters not listed may change in the future as the litigation and events related thereto unfold.

X
- Definition The entire disclosure for commitments and contingencies. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 440 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 4 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482648/440-10-50-4 Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 450 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//450/tableOfContent Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 954 -SubTopic 440 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480327/954-440-50-1 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 440 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 4 -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482648/440-10-50-4 Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 440 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//440/tableOfContent + Details
Name: | us-gaap_CommitmentsAndContingenciesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_DisclosureTextBlockAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration