Note 11 - Commitments and Contingencies	3 Months Ended
Mar. 31, 2020
Notes to Financial Statements
Commitments and Contingencies Disclosure [Text Block]	Note 11. Commitments and Contingencies Office Leases We have long-term operating leases for office, industrial and laboratory space in Westminster, California, Oak Ridge, Tennessee, and Alberta, Canada. Payments made under operating leases are charged to the Consolidated Statement of Operations and Comprehensive Loss on a straight-line basis over the term of the operating lease agreement. For the three months ended March 31, 2019 and 2020, rental expense was $51,000 and $55,000, respectively. On January 1, 2019, we adopted ASC 842 which resulted in a right-of-use asset and lease liability. Short-term leases are not included in our analysis. The adoption resulted in an immaterial cumulative effect of an accounting change that was not recorded. The lease of our Westminster facility qualifies for the new treatment; it originated in August 2016, expires August 2020, contains a yearly escalation of 3%, and includes a four -year renewal option whereby the base rent is adjusted to then market value. We intend to exercise the option to extend the lease for four years. That has been included in the analysis. The lease of our Oak Ridge, Tennessee facility also qualifies, and it had one executed extension to September 2022, and has one renewal option for another five years where the rental rate would adjust to greater of the current price and fair market value. No determination has been made whether to exercise the renewal option for the Oak Ridge facility. The lease of our Canadian facility is less than one year. None of our leases have additional terms related to the payments or mechanics of the lease: there are not any common area maintenance charges or tax sharing arrangements, easement provisions or any free rent. Since there is no explicit interest rate in leases, management used its incremental borrowing rate, which is estimated to be 18%. As of March 31, 2020, our weighted average remaining lease term is four years and the total remaining operating lease payments is $667,000. Clyra Medical Consulting Agreement Clyra Medical (see Note 8 ) entered into a consulting agreement with Beach House Consulting, LLC, through which Jack B. Strommen will be providing consulting services to Clyra related to its sales and marketing activities and in exchange receive $23,000 per month for a period of four years. The agreement originally provided that Clyra’s obligation to pay fees under the agreement begin the month following Clyra reception of FDA pre-market clearance on its first product, which occurred in September 2019. In December 2019, the parties modified the agreement such that fees are incurred once Clyra generates $250,000 in monthly revenue on average for three consecutive months. The total cash obligation related to the agreement would be approximately $1.1 million.

Note

11.

Commitments and Contingencies

Office Leases

We have long-term operating leases for office, industrial and laboratory space in Westminster, California, Oak Ridge, Tennessee, and Alberta, Canada. Payments made under operating leases are charged to the Consolidated Statement of Operations and Comprehensive Loss on a straight-line basis over the term of the operating lease agreement. For the

three

months ended

March 31, 2019

and

2020,

rental expense was

$51,000

and

$55,000,

respectively. On

January 1, 2019,

we adopted ASC

842

which resulted in a right-of-use asset and lease liability. Short-term leases are

not

included in our analysis. The adoption resulted in an immaterial cumulative effect of an accounting change that was

not

recorded. The lease of our Westminster facility qualifies for the new treatment; it originated in

August 2016,

expires

August 2020,

contains a yearly escalation of

3%,

and includes a

four

-year renewal option whereby the base rent is adjusted to then market value. We intend to exercise the option to extend the lease for

four

years. That has been included in the analysis. The lease of our Oak Ridge, Tennessee facility also qualifies, and it had

one

executed extension to

September 2022,

and has

one

renewal option for another

five

years where the rental rate would adjust to greater of the current price and fair market value.

determination has been made whether to exercise the renewal option for the Oak Ridge facility. The lease of our Canadian facility is less than

one

year.

None

of our leases have additional terms related to the payments or mechanics of the lease: there are

not

any common area maintenance charges or tax sharing arrangements, easement provisions or any free rent. Since there is

explicit interest rate in leases, management used its incremental borrowing rate, which is estimated to be

18%.

As of

March 31, 2020,

our weighted average remaining lease term is

four

years and the total remaining operating lease payments is

$667,000.

Clyra Medical Consulting Agreement

Clyra Medical (see Note

) entered into a consulting agreement with Beach House Consulting, LLC, through which Jack B. Strommen will be providing consulting services to Clyra related to its sales and marketing activities and in exchange receive

$23,000

per month for a period of

four

years. The agreement originally provided that Clyra’s obligation to pay fees under the agreement begin the month following Clyra reception of FDA pre-market clearance on its

first

product, which occurred in

September 2019.

December 2019,

the parties modified the agreement such that fees are incurred once Clyra generates

$250,000

in monthly revenue on average for

three

consecutive months. The total cash obligation related to the agreement would be approximately

$1.1

million.