Note 11 - Debt Financing

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Debt Disclosure [Text Block]

11.     DEBT FINANCING

On June 19, 2019, the Company entered into a Cash Collateral Security agreement with BMO Harris Bank, N.A. (the BMO Harris agreement) to use for the sole purpose of issuing standby letters of credit. The BMO Harris agreement requires us to pledge as cash collateral 105% of the aggregate face amount of outstanding standby letters of credit. The Company pays 250 basis points on the face values of outstanding letters of credit. There are no financial covenants set forth in the BMO Harris agreement. At December 31, 2021, the Company had outstanding standby letters of credit totaling approximately $1,104 under the BMO Harris agreement. As of December 31, 2021, the Company held $1,161 in a separate restricted use designated BMO Harris Bank N.A. deposit account. Fuel Tech is committed to reimbursing the issuing bank for any payments made by the bank under these instruments.

On April 17, 2020, the Company received $1,556 in loan proceeds from the Paycheck Protection Program (PPP), established pursuant to the Coronavirus Aid, Relief, and Economic Security Act and administered by the U.S. Small Business Administration (SBA). The unsecured loan is evidenced by a promissory note of the Company dated April 15, 2020 in the principal amount of $1,556, issued to BMO Harris Bank N.A., the lender. 

On January 8, 2021, the Company received full forgiveness from the SBA for the entire balance of loan proceeds used to fund its qualified payroll expenses. The Company accounted for the PPP Loan as debt in accordance with ASC 470, Debt and accrued interest in accordance with the interest method under ASC 835-30.  When the loan was forgiven, the Company reduced the non-current liability by the amount forgiven and recorded other income in the Consolidated Statement of Operations. The SBA has the right to audit the loan forgiveness for 6 years after the date the loan was forgiven.