Commitments and Contingencies

6 Months Ended

Jun. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 12 - Commitments and Contingencies

Legal Proceedings 

The Company may be subject to legal proceedings and claims arising from contracts or other matters from time to time in the ordinary course of business. Management is not aware of any pending or threatened litigation where the ultimate disposition or resolution could have a material adverse effect on its financial position, results of operations or liquidity.

Lease Commitments

The Company is obligated under finance leases for certain research and computer equipment that expire on various dates through April 2022. At June 30, 2020, the gross amount of office and computer equipment, and research equipment and the related accumulated amortization recorded under the finance leases was $478 and $313, respectively.

In February 2012, the Company entered into an operating lease for its then corporate headquarters in Flagstaff, Arizona. The lease was originally due to expire in January 2015. In December 2013, the Company amended its lease to expand into the remaining area in the building and extended the term to December 31, 2019. In February 2014, the Company further amended the lease to expand into an adjacent building. The lease requires escalating rental payments over the lease term. Minimum rental payments under the operating lease are recognized on a straight-line basis over the term of the lease and accordingly, the Company records the difference between the cash rent payments and the recognition of rent expense as a deferred rent liability. The lease is guaranteed by the former President of the Company. In December 2019, we extended the current lease for only our manufacturing facilities located in Flagstaff, Arizona, occupying a total of 7,632 square feet of space. The lease for our manufacturing facilities expires in December 2020.

The Company has been seeking alternate manufacturing and warehousing space in anticipation of the December 2020 Flagstaff, Arizona lease expiration and, on June 22, 2020, the Company entered into a lease in Phoenix, Arizona for approximately 5,103 square feet of office/warehouse space. The lease will commence on August 1, 2020 and expires on November 30, 2024.

On December 1, 2019, we entered into a lease for our corporate headquarters in Phoenix, Arizona where we lease and occupy approximately 5,529 square feet of office space. This lease expires in November 2024.

We believe that our existing facilities are adequate and meet our current needs for business, manufacturing and research.

Rent expense was $132 and $127 for the six months ended June 30, 2020 and 2019, respectively. The future minimum lease payments under non-cancellable operating lease and future minimum finance lease payments as of June 30, 2020 are follows:

	Finance Leases		Operating Lease
Years Ending December 31,
2020		32		116
2021		58		136
2022		28		138
2023		-		141
2024		-		132
Total minimum lease payments	$	118	$	663

	Finance Leases
Less: amounts representing interest (ranging from 11.43% to 18.32%)	$	12
Present value of minimum lease payments		106
Less: current installments under finance lease obligations		53
Total long-term portion	$	53