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Leases
 9 Months Ended
Sep. 30, 2023
Leases [Abstract]  
Leases LEASES
The Company leases certain equipment, manufacturing, warehouse and office space under non-cancellable operating leases with expirations through 2027 under which it is responsible for related maintenance, taxes and insurance. The Company had one finance lease on a forklift containing a bargain purchase option, which was exercised in July 2022. As of March 25, 2022, the terms of our real estate operating lease have been modified beginning July 1, 2022 and extended through 2027. In accordance with ASC 842, Leases (“ASC 842”), the related lease liability was remeasured and the right-of-use asset was adjusted for each lease at the time of modification. The present value of the lease obligations for the lease was calculated using an incremental borrowing rate of 16.96%, which was the Company’s blended borrowing rates (including interest, annual facility fees, collateral management fees, bank fees and other miscellaneous lender fees) on its revolving lines of credit with Crossroads Financial Group, LLC (as described below in Note 7, “Debt”) and Factors Southwest L.L.C. (as described below in Note 7, “Debt”). The present value of the other remaining lease obligations continues to be calculated using an incremental borrowing rate of 7.25% (which excludes the annual facility fee and other lender fees), which was the Company’s borrowing rate on its former revolving line of credit with Austin Financial Services, Inc. The weighted average remaining lease term for the operating leases is 4.0 years.
Components of the operating lease costs recognized in net loss were as follows (in thousands):
Three months ended September 30,Nine months ended September 30,
 2023202220232022
Operating lease cost (income)
Sub-lease income$— $(9)$— $(90)
Lease cost122 83 354 298 
Total lease cost, net$122 $74 $354 $208 
Supplemental balance sheet information related to the Company’s operating and finance leases as of September 30, 2023 and December 31, 2022 are as follows (in thousands):
 September 30, 2023December 31, 2022
Operating Leases
Operating lease right-of-use assets$967 $1,180 
Operating lease liabilities$1,073 $1,227 
Finance Leases
Property and equipment13 13 
Allowances for depreciation(13)(13)
Finance lease assets, net$— $— 
Future minimum lease payments required under operating leases for each of the 12-month rolling periods below in effect at September 30, 2023 are as follows (in thousands):
Operating Leases
October 2023 to September 2024$378 
October 2024 to September 2025380 
October 2025 to September 2026388 
October 2026 to September 2027294 
Total future undiscounted lease payments1,440 
Less imputed interest367 
Total lease obligations$1,073 
Supplemental cash flow information related to leases for the three and nine months ended September 30, 2023 and 2022, was as follows (in thousands):
Three months ended September 30,Nine months ended September 30,
 2023202220232022
Supplemental cash flow information 
Cash paid, net, for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases$97 $86 $286 $326 
Financing cash flows from finance leases$— $— $— $1 
Leases LEASES
The Company leases certain equipment, manufacturing, warehouse and office space under non-cancellable operating leases with expirations through 2027 under which it is responsible for related maintenance, taxes and insurance. The Company had one finance lease on a forklift containing a bargain purchase option, which was exercised in July 2022. As of March 25, 2022, the terms of our real estate operating lease have been modified beginning July 1, 2022 and extended through 2027. In accordance with ASC 842, Leases (“ASC 842”), the related lease liability was remeasured and the right-of-use asset was adjusted for each lease at the time of modification. The present value of the lease obligations for the lease was calculated using an incremental borrowing rate of 16.96%, which was the Company’s blended borrowing rates (including interest, annual facility fees, collateral management fees, bank fees and other miscellaneous lender fees) on its revolving lines of credit with Crossroads Financial Group, LLC (as described below in Note 7, “Debt”) and Factors Southwest L.L.C. (as described below in Note 7, “Debt”). The present value of the other remaining lease obligations continues to be calculated using an incremental borrowing rate of 7.25% (which excludes the annual facility fee and other lender fees), which was the Company’s borrowing rate on its former revolving line of credit with Austin Financial Services, Inc. The weighted average remaining lease term for the operating leases is 4.0 years.
Components of the operating lease costs recognized in net loss were as follows (in thousands):
Three months ended September 30,Nine months ended September 30,
 2023202220232022
Operating lease cost (income)
Sub-lease income$— $(9)$— $(90)
Lease cost122 83 354 298 
Total lease cost, net$122 $74 $354 $208 
Supplemental balance sheet information related to the Company’s operating and finance leases as of September 30, 2023 and December 31, 2022 are as follows (in thousands):
 September 30, 2023December 31, 2022
Operating Leases
Operating lease right-of-use assets$967 $1,180 
Operating lease liabilities$1,073 $1,227 
Finance Leases
Property and equipment13 13 
Allowances for depreciation(13)(13)
Finance lease assets, net$— $— 
Future minimum lease payments required under operating leases for each of the 12-month rolling periods below in effect at September 30, 2023 are as follows (in thousands):
Operating Leases
October 2023 to September 2024$378 
October 2024 to September 2025380 
October 2025 to September 2026388 
October 2026 to September 2027294 
Total future undiscounted lease payments1,440 
Less imputed interest367 
Total lease obligations$1,073 
Supplemental cash flow information related to leases for the three and nine months ended September 30, 2023 and 2022, was as follows (in thousands):
Three months ended September 30,Nine months ended September 30,
 2023202220232022
Supplemental cash flow information 
Cash paid, net, for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases$97 $86 $286 $326 
Financing cash flows from finance leases$— $— $— $1