10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2023.

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             

Commission File Number 000-19709

BIOLARGO, INC.

(Exact name of registrant as specified in its charter)

Delaware	65-0159115
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

14921 Chestnut St.

Westminster, CA 92683

(Address of principal executive offices)

(888) 400-2863

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common stock	BLGO	OTC Markets (OTCQB)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  ☒         No      ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer   ☐	Accelerated filer ☐
Non-accelerated filer   ☒	Smaller reporting company ☒
	Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.         ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

The number of shares of the Registrant’s Common Stock outstanding as of May 15, 2023 was 284,690,284 shares.  

BIOLARGO, INC.

FORM 10-Q

INDEX

Item 1	Financial Statements	F-1
Item 2	Management's Discussion and Analysis and Financial Condition and Results of Operations	24
Item 4	Controls and Procedures	35

Item 1A	Risk Factors	36
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	36
Item 5	Other Information	37
Item 6	Exhibits	37
	Signatures	39

i

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

BIOLARGO, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

AS OF MARCH 31, 2023 AND DECEMBER 31, 2022

(in thousands, except for share and per share data)

	MARCH 31,			DECEMBER 31,
	2023 (unaudited)			2022
Assets
Current assets:
Cash and cash equivalents	$	3,264		$	1,851
Accounts receivable, net of allowance		1,380			1,064
Inventories, net of allowance		135			120
Prepaid expenses and other current assets		95			118
Total current assets		4,874			3,153
Equipment, net of depreciation		391			287
Other non-current assets		124			124
Investment in South Korean joint venture		27			33
Right of use, operating lease, net of amortization		837			867
Clyra Medical prepaid marketing		394			394
Total assets	$	6,647		$	4,858
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable and accrued expenses	$	1,224		$	940
Clyra Medical accounts payable and accrued expenses		278			238
Debt obligations		66			100
Deferred revenue		21			17
Lease liability		97			97
Deposits		113			184
Total current liabilities		1,799			1,576
Long-term liabilities:
Debt obligations, net of current		302			237
Lease liability, net of current		747			773
Clyra Medical debt obligations		247			261
Total long-term liabilities		1,296			1,271
Total liabilities		3,095			2,847
COMMITMENTS AND CONTINGENCIES (Note 12)
STOCKHOLDERS’ EQUITY:
Preferred Series A, $0.00067 Par Value, 50,000,000 Shares Authorized, -0- Shares Issued and Outstanding, at March 31, 2023 and December 31, 2022		—			—
Common stock, $0.00067 Par Value, 550,000,000 Shares Authorized, 284,122,581 and 278,462,706 Shares Issued, at March 31, 2023 and December 31, 2022, respectively		190			186
Additional paid-in capital		150,191			148,435
Accumulated deficit		(143,841	)		(143,594	)
Accumulated other comprehensive loss		(155	)		(149	)
Total BioLargo Inc. and subsidiaries stockholders’ equity		6,385			4,878
Non-controlling interest		(2,833	)		(2,867	)
Total stockholders’ equity		3,552			2,011
Total liabilities and stockholders’ equity	$	6,647		$	4,858

The accompanying notes are an integral part of these unaudited consolidated financial statements.

F-1

BIOLARGO, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

FOR THE THREE MONTHS ENDED MARCH 31, 2023 AND 2022

(in thousands, except for share and per share data)

(unaudited)

	MARCH 31, 2023			MARCH 31, 2022
Revenue
Product revenue	$	3,548		$	610
Service revenue		194			355
Total revenue		3,742			965
Cost of revenue
Cost of goods sold		(1,797	)		(293	)
Cost of service		(135	)		(151	)
Total cost of revenue		(1,932	)		(444	)
Gross profit		1,810			521
Operating expenses:
Selling, general and administrative expenses		1,722			1,839
Research and development		565			392
Total operating expenses		2,287			2,231
Operating loss		(477	)		(1,710	)
Other income (expense):
PPP forgiveness		—			174
Grant income		31			5
Interest expense		(48	)		(13	)
Total other (expense) income		(17	)		166
Net loss		(494	)		(1,544	)
Net (loss) income attributable to noncontrolling interest		(247	)		108
Net loss attributable to common stockholders	$	(247	)	$	(1,652	)
Net loss per share attributable to common stockholders:
Loss per share attributable to stockholders – basic and diluted	$	(0.0009	)	$	(0.0063	)
Weighted average number of common shares outstanding:		280,711,278			260,805,418
Comprehensive loss attributable to common stockholders
Net loss	$	(494	)	$	(1,544	)
Foreign currency translation adjustment		(6	)		(8	)
Comprehensive loss		(500	)		(1,552	)
Comprehensive (loss) income attributable to noncontrolling interest		(247	)		108
Comprehensive loss attributable to stockholders	$	(253	)	$	(1,660	)

The accompanying notes are an integral part of these unaudited consolidated financial statements.

F-2

BIOLARGO, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

FOR THE THREE MONTHS ENDED MARCH 31, 2023 AND 2022

(in thousands, except for share and per share data)

(unaudited)

	Common stock				Additional paid-in		Accumulated			Accumulated other comprehensive			Non- controlling			Total stockholders’
	Shares		Amount		capital		deficit			Loss			interest			equity (deficit)
Balance, December 31, 2022		278,462,706	$	186	$	148,435	$	(143,594	)	$	(149	)	$	(2,867	)	$	2,011
Sale of stock for cash		4,201,402		3		797		—			—			—			800
Issuance of common stock for services		930,490		1		206		—			—			—			207
Issuance of common stock in exchange for Clyra shares		527,983		—		—		—			—			—			—
Stock option compensation expense		—		—		195		—			—			—			195
Clyra Medical Technologies, Inc. (Clyra) stock options issued for services		—		—		61		—			—			—			61
Warrant issued for interest		—		—		30		—			—			—			30
Clyra – sales of Series A Preferred Stock		—		—		—		—			—			225			225
Clyra – Series A Preferred Stock – dividend		—		—		—		—			—			(27	)		(27	)
Biolargo Energy Technology Inc. (BETI) offering		—		—		—		—			—			550			550
Noncontrolling interest allocation		—		—		467		—			—			(467	)		—
Net loss		—		—		—		(247	)		—			(247	)		(494	)
Foreign currency translation		—		—		—		—			(6	)		—			(6	)
Balance, March 31, 2023		284,122,581	$	190	$	150,191	$	(143,841	)	$	(155	)	$	(2,833	)	$	3,552

	Common stock				Additional paid-in			Accumulated			Accumulated other comprehensive			Non- controlling			Total stockholders’
	Shares		Amount		capital			deficit			Loss			interest			equity (deficit)
Balance, December 31, 2021		255,893,726	$	171	$	143,718		$	(139,121	)	$	(115	)	$	(3,720	)	$	933
Sale of common stock for cash		6,703,789		4		1,198			—			—			—			1,202
Issuance of common stock for service		86,752		—		17			—			—			—			17
Stock option compensation expense		—		—		660			—			—			—			660
Clyra Medical stock option expense		—		—		141			—			—			—			141
Noncontrolling interest allocation		—		—		(528	)		—			—			528			—
Net loss		—		—		—			(1,652	)		—			108			(1,544	)
Foreign currency translation		—		—		—			—			(8	)		—			(8	)
Balance, March 31, 2022		262,684,267	$	176	$	145,205		$	(140,773	)	$	(123	)	$	(3,085	)	$	1,400

The accompanying notes are an integral part of these unaudited consolidated financial statements.

F-3

BIOLARGO, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE THREE MONTHS ENDED MARCH 31, 2023 AND 2022

(in thousands, except for share and per share data)

(unaudited)

	MARCH 31, 2023			MARCH 31, 2022
Cash flows from operating activities
Net loss	$	(494	)	$	(1,544	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock option compensation expense		256			801
Common stock issued for services		207			17
Interest expense related to amortization of the discount on note payable		3			4
Fair value of warrant issued for interest		30			—
PPP loan forgiveness		—			(174	)
Loss on investment in South Korean joint venture		6			8
Depreciation expense		22			2
Changes in assets and liabilities:
Accounts receivable		(316	)		(178	)
Inventories		(17	)		(29	)
Prepaid expenses and other assets		25			(59	)
Accounts payable and accrued expenses		284			114
Clyra accounts payable and accrued expenses		14			(25	)
Deferred revenue		4			(89	)
Right of use and lease liability, net		4			—
Deposit		(71	)		12
Net cash used in operating activities		(43	)		(1,140	)
Cash flows from investing activities
Equipment purchases		(48	)		(32	)
Net cash used in investing activities		(48	)		(32	)
Cash flows from financing activities
Proceeds from sale of common stock		800			1,202
Proceeds from sale of BETI common stock		550			—
Repayment of note payable		(50	)		—
Repayment by Clyra on inventory line of credit		(15	)		(10	)
Proceeds from sale of Clyra Medical preferred stock		225			—
Net cash provided by financing activities		1,510			1,192
Net effect of foreign currency translation		(6	)		(8	)
Net change in cash		1,413			12
Cash at beginning of year		1,851			962
Cash at end of period	$	3,264		$	974
Supplemental disclosures of cash flow information
Cash paid during the year for:
Interest	$	15		$	7
Income taxes	$	5		$	—
Short-term lease payments not included in lease liability	$	13		$	52
Non-cash investing and financing activities
Equipment added via vehicle loan	$	80		$	—
Conversion of intercompany receivable into Clyra shares	$	—		$	633
Allocation of noncontrolling interest	$	467		$	528
Conversion of Clyra common stock to BioLargo common stock	$	100		$	—

The accompanying notes are an integral part of these unaudited consolidated financial statements.

F-4

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Note 1. Business and Organization

Description of Business

BioLargo, Inc. (“BioLargo”, or the “Company”) invents, develops, and commercializes innovative platform technologies to solve challenging environmental problems like PFAS contamination (per- and polyfluoroalkyl substances), advanced water and wastewater treatment, industrial odor control, air quality control, infection control, and myriad environmental remediation challenges. Our business strategy is straightforward: we invent or acquire technologies that we believe have the potential to be disruptive in large commercial markets; we develop and validate these technologies to advance and promote their commercial success as we leverage our considerable scientific, engineering, and entrepreneurial talent; we then monetize these technical assets through a variety of business structures that may include licensure, joint venture, sale, spin off, or by deploying direct to market strategies.

Organization

We are a Delaware corporation formed in 1991. We have five wholly-owned subsidiaries: BioLargo Life Technologies, Inc., organized under the laws of the State of California in 2006; ONM Environmental, Inc., organized under the laws of the State of California in 2009; BioLargo Equipment and Technologies, Inc., organized under the laws of the State of California in 2022; BioLargo Water, Inc. (“Water”), organized under the laws of Canada in 2014; and BioLargo Development Corp., organized under the laws of the State of California in 2016. Additionally, we own 82% (see Note 9) of BioLargo Engineering Science and Technologies, LLC (“BLEST”), organized under the laws of the State of Tennessee in 2017, 58% of Clyra Medical Technologies, Inc. (“Clyra” or “Clyra Medical”), organized under the laws of the State of California in 2012, and 97.1% of BioLargo Energy Technologies, Inc. (“BETI”) organized under the laws of the State of California in 2022. We consolidate the financial statements of our partially owned subsidiaries (see Note 2, subheading “Principles of Consolidation,” and Note 8).

Liquidity / Going concern

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of our business. For the three months ended March 31, 2023, we generated revenues of $3,742,000 through our subsidiaries (see Note 11), had a net loss of $494,000, used $43,000 cash in operations, and at March 31, 2023, we had working capital of $3,075,000, and current assets of $4,874,000. While our operating loss has decreased in recent quarterly periods, as has our cash used in operations, we expect to continue to need further investment capital to fund operations. We have been, and anticipate that we will continue to be, limited in terms of our capital resources.

During the three months ended March 31, 2023, we (i) sold $105,000 of our common stock to Lincoln Park Capital Fund, LLC (“Lincoln Park”) (see Note 3), (ii) sold $695,000 of our common stock and warrants to accredited investors (see Notes 3 and 6), (iii) sold $225,000 of Clyra Medical Series A Preferred Stock (see Note 8), and (iv) sold $550,000 of BETI common stock (see Note 10).

As of March 31, 2023, our cash and cash equivalents totaled $3,264,000. Our total liabilities included a $78,000 vehicle loan, $140,000 due in U.S. Small Business Administration (SBA) loans issued pursuant to the Paycheck Protection Program (see Note 4), $150,000 due to the SBA issued pursuant to the Economic Injury Disaster program (see Note 4), and $247,000 owed by Clyra Medical due in 2024 (see Note 8).

Subsequent to March 31, 2023, we continued to sell common stock to Lincoln Park for working capital as needed (see Note 13).

5

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

If we are unable to rely on our current arrangement with Lincoln Park to fund our working capital requirements, we will have to rely on other forms of financing, and there is no assurance that we will be able to do so, or if we do so, it will be on favorable terms.

The foregoing factors raise substantial doubt about our ability to continue as a going concern, unless we are able to continue to raise funds through stock sales to Lincoln Park or other private financings, and in the long term, our ability to attain a reasonable threshold of operating efficiencies and achieve profitable operations by licensing or otherwise commercializing products incorporating our technologies. The consolidated financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.

Note 2. Summary of Significant Accounting Policies

Principles of Consolidation

The consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries, and partially owned subsidiaries BETI, BLEST and Clyra Medical. All intercompany accounts and transactions have been eliminated.

Foreign Currency

The Company has designated the functional currency of BioLargo Water, Inc., our Canadian subsidiary, to be the Canadian dollar. Therefore, translation gains and losses resulting from differences in exchange rates are recorded in accumulated other comprehensive income.

Cash and Cash Equivalents

The Company considers all highly liquid investments with maturities of three months or less when acquired to be cash equivalents. Substantially all cash equivalents are held in short-term money market accounts at one of the largest financial institutions in the United States, Bank of America. From time to time, our cash account balances are greater than the Federal Deposit Insurance Corporation insurance limit of $250,000 per owner per bank, and during such times, we are exposed to credit loss for amounts in excess of insured limits in the event of non-performance by the financial institution. We do not anticipate non-performance by our financial institution.

As of March 31, 2023, and December 31, 2022, our cash balances were made up of the following (in thousands):

	March 31, 2023		December 31, 2022
BioLargo, Inc. and subsidiaries	$	3,171	$	1,685
Clyra Medical Technologies, Inc.		93		166
Total	$	3,264	$	1,851

Accounts Receivable

Trade accounts receivable are recorded net of allowances for doubtful accounts. Estimates for allowances for doubtful accounts are determined based on payment history and individual customer circumstances. The allowance for doubtful accounts as of March 31, 2023, and  December 31, 2022 was $12,000.

6

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

Credit Concentration

We have a limited number of customers that account for significant portions of our revenue. During the three months ended March 31, 2023, one customer accounted for more than 10% of consolidated revenues, and during the three months ended March 31, 2022, two customers each accounted for more than 10% of consolidated revenues:

	March 31, 2023			March 31, 2022
Customer A		86	%		29	%
Customer B	<10		%		14	%

At March 31, 2023, and December 31, 2022, one customer accounted for more than 10% of consolidated accounts receivable:

	March 31, 2023			December 31, 2022
Customer A		70	%		24	%

Inventory

Inventories are stated at the lower of cost or net realizable value using the average cost method. The allowance for obsolete inventory as of  March 31, 2023, and December 31, 2022, was $158,000. Inventories consisted of (in thousands):

	March 31, 2023		December 31, 2022
Raw material	$	52	$	46
Finished goods		83		74
Total	$	135	$	120

Other Non-Current Assets

Other non-current assets consisted of (i) security deposits related to our business offices, (ii) three patents acquired on  October 22, 2021, for $34,000, and (iii) tax credit receivables from the Canadian government related to a research and development credit from our Canadian subsidiary for which we’ve applied for and received in prior periods.

	March 31, 2023		December 31, 2022
Patents	$	34	$	34
Security deposits		36		36
Tax credit receivable		54		54
Total	$	124	$	124

Equity Method of Accounting

On March 20, 2020, we invested $100,000 into a South Korean entity (Odin Co. Ltd., “Odin”) pursuant to a Joint Venture agreement we had entered into with BKT Co. Ltd. and its U.S. based subsidiary, Tomorrow Water. We received a 40% non-dilutive equity interest, and BKT and Tomorrow Water each received 30% equity interests for an aggregate $150,000 investment.

7

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

We account for our investment in the joint venture under the equity method of accounting. We have determined that while we have significant influence over the joint venture through our technology license and our position on the Board of Directors, we do not control the joint venture or are otherwise involved in managing the entity and we own less than a majority of the equity. Therefore, we record the asset on our consolidated balance sheet and record an increase or decrease the recorded balance by our percentage ownership of the profits or losses in the joint venture. The joint venture has incurred a loss since inception and our 40% ownership share reduced our investment interest during the three months ended March 31, 2023, and 2022, by $6,000 and $8,000, respectively.

Impairment

Long-lived and definite lived intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If the sum of the expected future undiscounted cash flows from the use of the asset and its eventual disposition is less than the carrying amount of the asset, then an impairment loss is recognized. The impairment loss is measured based on the fair value of the asset. Any resulting impairment is recorded as a reduction in the carrying value of the related asset in excess of fair value and a charge to operating results.

Earnings (Loss) Per Share

We report basic and diluted earnings (loss) per share (“EPS”) for common and common share equivalents. Basic EPS is computed by dividing reported earnings by the weighted average shares outstanding. Diluted EPS is computed by adding to the weighted average shares the dilutive effect if convertible notes payable, stock options and warrants were exercised into common stock. For the three months ended March 31, 2023, and 2022, the denominator in the diluted EPS computation is the same as the denominator for basic EPS due to the Company’s net loss which creates an anti-dilutive effect of the convertible notes payable, warrants and stock options.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and revenues and expenses during the period reported. Actual results could differ from those estimates. Estimates are used when accounting for stock-based transactions, debt transactions, derivative liabilities, allowance for bad debt, asset depreciation and amortization, impairment expense, among others.

The methods, estimates and judgments we use in applying these most critical accounting policies have a significant impact on the results of our financial statements.

Share-Based Compensation Expense

We recognize compensation expense for stock option awards on a straight-line basis over the applicable service period of the award, which is the vesting period. Fair value is determined on the grant date. Share-based compensation expense is based on the grant date fair value estimated using the Black-Scholes Option Pricing Model.

For stock and stock options issued to consultants and other non-employees for services, the Company measures and records an expense as of the earlier of the date at which either: a commitment for performance by the non-employee has been reached or the non-employee’s performance is complete. The equity instruments are measured at the current fair value, and for stock options, the instruments are measured at fair value using the Black Scholes option model.

8

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

The following methodology and assumptions were used to calculate share-based compensation for the three months ended March 31, 2023, and 2022:

	2023						2022
	Non Plan			2018 Plan			Non Plan			2018 Plan
Risk free interest rate		3.48	%		3.48	%	2.32	–	3.83%	2.32	–	3.83%
Expected volatility		114	%		114	%	114	–	117%	114	–	117%
Expected dividend yield		—			—			—			—
Forfeiture rate		—			—			—			—
Life in years		10			10			10			10

Expected price volatility is the measure by which our stock price is expected to fluctuate during the expected term of an option. The expected volatility is derived from the historical daily change in the market price of our common stock, as we believe that historical volatility is the best indicator of future volatility.

The risk-free interest rate used in the Black-Scholes calculation is based on the prevailing U.S. Treasury yield as determined by the U.S. Federal Reserve. We have never paid any cash dividends on our common stock and do not anticipate paying cash dividends on our common stock in the foreseeable future.

Warrants

Warrants issued with our convertible and non-convertible debt instruments are accounted for under the fair value and relative fair value method.

The warrant is first analyzed per its terms as to whether it has derivative features or not. If the warrant is determined to be a derivative and not qualify for equity treatment, then it is measured at fair value using the Black Scholes option model and recorded as a liability on the balance sheet. The warrant is re-measured at its then current fair value at each subsequent reporting date (it is “marked-to-market”).

If the warrant is determined to not have derivative features, it is recorded into equity at its fair value using the Black Scholes option model, however, limited to a relative fair value based upon the percentage of its fair value to the total fair value including the fair value of the convertible note.

Convertible debt instruments are recorded at fair value, limited to a relative fair value based upon the percentage of its fair value to the total fair value including the fair value of the warrant.

The warrant relative fair values are also recorded as a discount to the convertible promissory notes. As present, these equity features of the convertible promissory notes have recorded a discount to the convertible notes that is substantially equal to the proceeds received.

Non-Cash Transactions

We determine the value assigned to each intangible we acquire, and/or services or products received for non-cash consideration of our common stock based on the market price of our common stock issued as consideration, at the date of the agreement of each transaction or when the service is rendered or product is received.

Revenue Recognition

We account for revenue in accordance with ASC 606, “Revenue from Contacts with Customers”. The guidance focuses on the core principle for revenue recognition, which is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, the guidance provides that an entity should apply the following steps:

Step 1: Identify the contract(s) with a customer.

9

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

Step 2: Identify the performance obligations in the contract.

Step 3: Determine the transaction price.

Step 4: Allocate the transaction price to the performance obligations in the contract.

Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation.

The Company’s products are sold through a contract with the customer and a written purchase order, in which the details of the contract are defined including the transaction price and method of shipment. The only performance obligation is to create and ship the product, and each product has separate pricing. Revenue is recognized at a point in time when the goods are shipped if the agreement is FOB manufacturer, and when goods are delivered if FOB destination. Revenue is recognized with a reduction for sales discounts, as appropriate and negotiated in the customer’s purchase order.

Service contracts are performed through a written contract, which specifies the performance obligations and the rate at which the services will be billed, typically by time and materials. Each service is separately negotiated and priced. Revenue is recognized as services are performed and completed, or, for services related to product installations, at the completion of the installation. A few contracts have called for milestone or fixed cost payments, where we invoice an agreed-to amount per month for the life of the contract. In these instances, completed work, billed hourly, is recognized as revenue. If the billing amount is greater or lesser than the completed work, a receivable or payable is created. These accounts are adjusted upon additional billings as the work is completed. To date, there have been no discounts or other financing terms for the contracts.

The Company has outstanding contract liability obligations of $21,000 as of March 31, 2023, recorded as deferred revenue. We recognized $8,000 in revenue and reduce the deferred revenue balance by the same amount as performance obligations were satisfied in the three months ended March 31 ,2023. The outstanding balance will be recognized over the remaining life of the contracts.

As we generate revenues from royalties or license fees from our intellectual property, a licensee will pay a license fee in one or more installments and ongoing royalties based on their sales of products incorporating or using our licensed intellectual property. We have entered into a licensing agreement for the CupriDyne Clean product, and we recognize royalty and license fees on a quarterly basis as the product is sold through to third parties and reported to us.

Clyra also has certain distribution agreements that call for consigned inventory. Although the product is shipped to a third party, it is not revenue until that consigned inventory is sold to end user customer.

Government Grants

We have been awarded multiple research grants from the private and public Canadian research programs. The income we receive directly from grants is recorded as other income. We have been awarded over 80 grants since our first in 2015. Some of the funds from these grants are given directly to third parties (such as the University of Alberta or a third-party research scientist) to support research on our technology. The grants have terms generally ranging between six and eighteen months and support a majority, but not all, of the related research budget costs. This cooperative research allows us to utilize (i) a depth of resources and talent to accomplish highly skilled work, (ii) financial aid to support research and development costs, (iii) independent and credible validation of our technical claims.

The grants typically provide for (i) recurring monthly amounts, (ii) reimbursement of costs for research talent for which we invoice to request payment, and (iii) ancillary cost reimbursement for research talent travel related costs. All awarded grants have specific requirements on how the money is spent, typically to employ researchers. None of the funds may be used for general administrative expenses or overhead in the United States. These grants have substantially increased our level of research and development activities in Canada. We continue to apply for Canadian government and agency grants to fund research and development activities. Not all of our grant applications have been awarded, and no assurance can be made that any pending grant application, or any future grant applications, will be awarded.

10

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

Income Taxes

The asset and liability approach is used to recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of asset and liabilities. Deferred tax assets and liabilities are determined based on the differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The effect on deferred tax asset and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

We account for uncertainties in income tax law under a comprehensive model for the financial statement recognition, measurement, presentation, and disclosure of uncertain tax positions taken or expected to be taken in income tax returns as prescribed by generally accepted accounting principles (“GAAP”).  Under GAAP, the tax effects of a position are recognized only if it is “more-likely-than-not” to be sustained by the taxing authority as of the reporting date.  If the tax position is not considered “more-likely-than-not” to be sustained, then no benefits of the position are recognized.  Management believes there are no unrecognized tax benefits or uncertain tax positions as of March 31, 2023, and December 31, 2022.

The Company assessed its earnings history, trends and estimates of future earnings and determined that the deferred tax asset could not be realized as of March 31, 2023, and December 31, 2022. Accordingly, a valuation allowance was recorded against the net deferred tax asset.

The Company recognizes interest and penalties on income taxes as a component of income tax expense, should such an expense be realized.

Fair Value of Financial Instruments

Management believes the carrying amounts of the Company’s financial instruments as of March 31, 2023 and December 31, 2022 approximate their respective fair values because of the short-term nature of these instruments. Such instruments consist of cash, accounts receivable, prepaid assets, accounts payable, line of credit, and other assets and liabilities. The carrying amount of debt instruments are believed to approximate fair value as the stated interest rates are reflective of the prevailing market rates.

Tax Credits

Our research and development activities in Canada may entitle our Canadian subsidiary to claim benefits under the “Scientific Research and Experimental Development Program”, a Canadian federal tax incentive program designed to encourage Canadian businesses of all sizes and in all sectors to conduct research and development in Canada. Benefits under the program include credits to taxable income. If our Canadian subsidiary does not have taxable income in a reporting period, we instead receive a tax refund from the Canadian Revenue Authority. Those refunds are classified in Other Income on our Consolidated Statement of Operations and Comprehensive Loss.

Leases

At inception of a lease contract, we assess whether the contract is, or contains, a lease. Our assessment is based on: (1) whether the contract involves the use of a distinct identified asset, (2) whether we obtain the right to substantially all the economic benefit from the use of the asset throughout the period of the contract, and (3) whether we have the right to direct the use of the asset during such time period. At inception of a lease, we allocate the consideration in the contract to each lease component based on its relative stand-alone price to determine the lease payments. Leases are classified as either finance leases or operating leases. A lease must be classified as a finance lease if any of the following criteria are met: the lease transfers ownership of the asset by the end of the lease term, the lease contains an option to purchase the asset that is reasonably certain to be exercised, the lease term is for a major part of the remaining useful life of the asset or the present value of the lease payments equals or exceeds substantially all of the fair value of the asset. A lease is classified as an operating lease if it does not meet any of these criteria. We have no leases classified as finance leases. As of March 31, 2023, the weighted average remaining lease term for our operating leases was nine years. The weighted average discount rate for our operating leases was 18%. For all leases at the lease commencement date, a right-of-use asset and a lease liability are recognized. The right-of-use asset represents the right to use the leased asset for the lease term. The lease liability represents the present value of the lease payments under the lease. The right-of-use asset is initially measured at cost, which primarily comprises the initial amount of the lease liability, plus any initial direct costs incurred, consisting mainly of brokerage commissions, less any lease incentives received. All right-of-use assets are reviewed for impairment. The lease liability is initially measured at the present value of the lease payments, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, management estimates the incremental borrowing rate, which currently is estimated to be 18%. Lease payments included in the measurement of the lease liability comprise the following: the fixed noncancelable lease payments, payments for optional renewal periods where it is reasonably certain the renewal period will be exercised, and payments for early termination options unless it is reasonably certain the lease will not be terminated early. Lease components are included in the measurement of the initial lease liability. Additional payments based on a change in our portion of the operating expenses, including real estate taxes and insurance, are recorded as a period expense when incurred. Lease modifications result in remeasurement of the lease liability. Lease expense for operating leases consists of the lease payments plus any initial direct costs, primarily brokerage commissions, and is recognized on a straight-line basis over the lease term. We have elected not to recognize right-of-use assets and lease liabilities for short-term leases that have a term of 12 months or less. The effect of short-term leases on our right-of-use asset and lease liability was not material.

As of March 31, 2023, the right-of-use assets totaled $837,000 and the lease liability totaled $844,000 on our balance sheet related to our operating leases.

Equipment

Equipment is stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, which range from 3 - 5 years. Additions, renewals, and betterments that significantly extend the life of the asset are capitalized. Expenditures for repairs and maintenance are charged to expense as incurred. For assets sold or otherwise disposed of, the cost and related accumulated depreciation and amortization are removed from the accounts, and any related gain or loss is reflected in income for the period.

11

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

Measurement of Credit Losses on Financial Instruments

In June 2016, the FASB issued ASU 2016-13, which sets out the principles for the recognition of measurement of credit losses on financial instruments, including trade receivables. The standard eliminates the probable initial recognition threshold and requires an entity to reflect its current estimate of all expected credit losses. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected. The new standard was effective for the Company beginning January 1, 2023 and primarily impacted trade accounts receivable. 

Accounts receivable are customer obligations that are unconditional. Accounts receivable are presented net of an allowance for doubtful accounts for expected credit losses, which represents an estimate of amounts that may not be collectible. The Company performs ongoing credit evaluations of its customers and, if necessary, provides an allowance for doubtful accounts and expected credit losses. A provision to the allowances for doubtful accounts for expected credit losses is recorded based on factors including the length of time the receivables are past due, the current business environment, and the Company’s historical experience. Provisions to the allowances for doubtful accounts for expected credit losses are recorded to general and administrative expenses. The Company writes off accounts receivable against the allowance when it determines a balance is uncollectible and no longer actively pursues collection of the receivable. The Company does not have any off-balance-sheet credit exposure related to customers. As of March 31, 2023 and December 31, 2022, the allowance for doubtful accounts for expected credit losses was $12,000.

Recent Accounting Pronouncements

Currently there are no recently released pronouncements that are considered applicable to the Company’s financial statements.

Note 3. Sale of Stock for Cash

Lincoln Park Financing

On December 13, 2022, we entered into a stock purchase agreement (the “2022 LPC Purchase Agreement”) with Lincoln Park, pursuant to which Lincoln Park agreed to purchase from us at our request up to an aggregate of $10,000,000 of our common stock (subject to certain limitations) from time to time over a period of three years. The agreement allows us, at our sole discretion, to direct Lincoln Park to purchase shares of our common stock, subject to limitations in both volume and dollar amount. The purchase price of the shares that may be sold to Lincoln Park under the agreement is the lower of (i) the lowest sale price on the date of purchase, or (ii) the average of the three lowest closing prices in the prior 12 business days. There are no restrictions on future financings, rights of first refusal, participation rights, penalties, or liquidated damages other than a prohibition on entering into a “Variable Rate Transaction,” as defined in the agreement. Concurrently with the 2022 LPC Purchase Agreement, we entered into a Registration Rights Agreement, pursuant to which we filed a registration statement on Form S-1 with the SEC on December 23, 2022. This registration statement was declared effective on January 19, 2023.

During the three months ended March 31, 2023, and 2022, we sold 545,402 and 1,506,821 shares of our common stock to Lincoln Park, and received $105,000 and $346,000, respectively, in gross and net proceeds.

Unit Offerings

During the three months ended March 31, 2023, and 2022, we sold 3,656,000 and 5,196,968 shares of our common stock and received $695,000 and $856,000 in gross and net proceeds from accredited investors. In addition to the shares, we issued each investor a six-month and a five-year warrant to purchase additional shares. (See Note 6, “Warrants Issued in Unit Offering”.)

Note 4. Debt Obligations

The following table summarizes our debt obligations outstanding as of March 31, 2023, and December 31, 2022 (in thousands). The table does not include debt obligations of our partially owned subsidiary Clyra Medical (see Note 8, “Debt Obligations of Clyra Medical”).

	March 31, 2023		December 31, 2022
Current portion of debt:
SBA Paycheck Protection Program loan	$	43	$	43
Vehicle loan, current portion		13		—
Convertible note payable, matures March 1, 2023		—		50
SBA EIDL Loan, matures July 2053, current portion		10		10
Debt discount, net of amortization		—		(3	)
Total current portion of debt	$	66	$	100
Long-term debt:
SBA Paycheck Protection Program loans, matures May 2025	$	97	$	97
Vehicle loan, matures March 2029		65		—
SBA EIDL Loan, matures July 2053		140		140
Total long-term debt, net of current	$	302	$	237
Total	$	368	$	337

12

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

For the three months ended March 31, 2023, and 2022, we recorded $48,000 and $13,000 of interest expense related to the amortization of discounts on convertible notes payable and coupon interest from our convertible notes and lines of credit.

Vehicle loan

On February 7, 2023, we entered a loan agreement with Bank of America for the purchase of a vehicle used in operations totaling $80,000, at 5.29% annual interest which matures March 7, 2029. The loan agreement requires monthly payments of $1,118.

Convertible note payable, matures March 1, 2023

On March 6, 2023, we entered into an agreement with the holder of a $50,000 note to convert that note into common stock of BETI (see note 10). As payment for interest, a warrant to purchase 200,000 shares of BioLargo common stock at $0.21 was issued to the investor, expiring five years from the grant date. (See Note 6).

SBA Program Loans

On  February 7, 2022, we received notice that the SBA had forgiven $173,821 of ONM Environmental's $217,243 Paycheck Protection Program (PPP) loan. ONM has appealed this decision. On May 12, 2022, we received notice that the SBA had denied the forgiveness application of BLEST’s $97,000 PPP loan. We have appealed that decision. During the period upon which a forgiveness decision is on appeal, loan payments are deferred. The maturity date of the BLEST PPP loan was officially extended on our request to May 2025.

In July 2020, ONM Environmental received an Economic Injury Disaster Loan from the SBA in the amount of $150,000. The note has a 3.75% annual interest rate. For the three months ended March 31, 2023, interest expense totaled $2,000.

Note 5. Share-Based Compensation

Issuance of Common Stock in exchange for Services

Payment of Officer Salaries

On March 31, 2023, an officer agreed to convert an aggregate $6,000 of accrued and unpaid salary into 30,747 shares of our common stock at $0.20 per share. Shares issued to Officers are unvested at the date of grant and subject to a lock-up agreement restricting vesting and sale until the earlier of (i) the consummation of a sale (in a single transaction or in a series of related transactions) of BioLargo by means of a sale of (a) a majority of the then outstanding common stock of BioLargo (whether by merger, consolidation, sale or transfer of common stock, reorganization, recapitalization or otherwise) or (b) all or substantially all of the assets of BioLargo; and (ii) the successful commercialization of BioLargo’s products or technologies as demonstrated by its receipt of at least $3,000,000 in cash, or the recognition of $3,000,000 in revenue, over a 12-month period from the sale of products and/or the license of technology; and (iii) the Company’s breach of the employment agreement between the Company and Officer and resulting in Officer’s termination.

13

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

Payment of Consultant Fees

On  March 31, 2023, we issued 899,743 shares of our common stock at $0.20 per share in lieu of $201,000 of accrued and unpaid obligations to consultants.

On  March 31, 2022, we issued 86,752 shares of our common stock at $0.23 per share in lieu of $17,000 of accrued and unpaid obligations to consultants. 

All of these offerings and sales were made in reliance on the exemption from registration contained in Section 4(2) of the Securities Exchange Act and/or Regulation D promulgated thereunder as not involving a public offering of securities.

Stock Option Expense

During the three months ended March 31, 2023, and 2022, we recorded an aggregate $256,000 and $801,000, respectively, in selling general and administrative expense related to the issuance of stock options. We issued options through our 2018 Equity Incentive Plan, and outside of this plan. Within these totals, $61,000 and $141,000 were issued by our subsidiary Clyra Medical (see Note 8).

2018 Equity Incentive Plan

On June 22, 2018, our stockholders adopted the BioLargo 2018 Equity Incentive Plan (“2018 Plan”) as a means of providing our directors, key employees, and consultants additional incentive to provide services. Both stock options and stock grants may be made under this plan for a period of 10 years. It is set to expire on its terms on June 22, 2028. Our Board of Director’s Compensation Committee administers this plan. As plan administrator, the Compensation Committee has sole discretion to set the price of the options. The plan authorizes the following types of awards: (i) incentive and non-qualified stock options, (ii) restricted stock awards, (iii) stock bonus awards, (iv) stock appreciation rights, (v) restricted stock units, and (vi) performance awards. The total number of shares reserved and available for awards pursuant to this Plan as of the date of adoption of this 2018 Plan by the Board is 40 million shares. The number of shares available to be issued under the 2018 Plan increases automatically each January 1^st by the lesser of (a) 2 million shares, or (b) such number of shares determined by our Board. As of March 31, 2023, 50,000,000 shares are authorized under the plan.

Activity for our stock options under the 2018 Plan during the three months ended March 31, 2023, and 2022, is as follows:

	Options Outstanding			Exercise Price per share				Weighted Average Price per share		Aggregate intrinsic Value(1)
Balance, December 31, 2022		28,484,549		$0.12	–	0.43	$	0.19
Granted		1,320,498			$0.20		$	0.2
Balance, March 31, 2023		29,805,047		$0.12	–	0.43	$	0.19
Unvested		(4,073,761	)	$0.12	–	0.32	$	0.19
Vested, March 31, 2023		25,731,286		$0.12	–	0.43	$	0.19	$	678,000
Balance, December 31, 2021		23,186,142		$0.16	–	0.40	$	0.19
Granted		2,621,229		$0.12	–	0.23	$	0.23
Balance, March 31, 2022		25,807,371		$0.12	–	0.40	$	0.19

(1) – Aggregate intrinsic value based on closing common stock price of $0.20 at March 31, 2023.

14

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

The options granted to purchase 1,320,498 shares during the three months ended March 31, 2023 with an aggregate fair value of $248,000 were issued to an officer, board of directors, employees and a consultant:  (i) we issued options to purchase 347,730 shares of our common stock at an exercise price on the respective grant date of $0.20 per share to members of our board of directors for services performed, in lieu of cash; the fair value of these options totaled $65,000; (ii) we issued options to purchase 570,204 shares of our common stock to employees as part of an employee retention plan at an exercise price on the respective date of $0.20 per share; the fair value of employee retention plan options totaled $108,000 and will vest quarterly over four years as long as they are retained as employees; (iii) we issued options to purchase 102,564 shares of our common stock to consultants in lieu of cash for expiring options at $0.20 per share totaling $19,000, and (iv) we issued 300,000 options to our Chief Financial Officer with a fair value of $56,000 (see “Chief Financial Officer Contract Extension” immediately below). All stock option expense is recorded on our consolidated statement of operations as selling, general and administrative expense.

The options granted to purchase 2,621,229 shares during the three months ended  March 31, 2022 with an aggregate fair value of $564,000 were issued to officers, board of directors, employees and consultants: (i) we issued an option to purchase 39,848 shares of our common stock at an exercise price on the respective grant date of $0.23 per share to our CFO and President to replace options that had expired; the fair value of this option was $9,000; (ii) we issued options to purchase 444,092 shares of our common stock at an exercise price on the respective grant date of $0.23 per share to members of our board of directors for services performed, in lieu of cash; the fair value of these options totaled $96,000; (iii) we issued options to purchase 1,690,257 shares of our common stock to employees as part of an employee retention plan at an exercise price on the respective date of $0.23 per share; the fair value of employee retention plan options totaled $362,000 and will vest quarterly over four years as long as they are retained as employees; and (iv) we issued options to purchase 447,032 shares of our common stock to consultants in lieu of cash for expiring options and per agreement totaling $97,000. All stock option expense is recorded on our consolidated statement of operations as selling, general and administrative expense.

Chief Financial Officer Contract Extension

On March 21, 2023, we and our Chief Financial Officer Charles K. Dargan, II formally agreed to extend the engagement agreement dated February 1, 2008 (the “Engagement Agreement”, which had been previously extended multiple times), pursuant to which Mr. Dargan has been and continues to serve as the Company’s Chief Financial Officer. The Engagement Extension Agreement dated as of March 21, 2023 (the “Engagement Extension Agreement”) provides for an additional one-year term to expire January 31, 2024 (the “Extended Term”), at which time Mr. Dargan will continue to serve as CFO, unless and until either party terminates the agreement.

As the sole compensation for the Extended Term, Mr. Dargan was issued an option (“Option”) to purchase 25,000 shares of the Company’s common stock for each month during the Extended Term (thus, an option to purchase 300,000 shares reflecting an extended term of 12 months). The Option vests over the period of the Extended Term, with 25,000 shares having vested as of March 21, 2023, and the remaining shares to vest 25,000 shares monthly beginning March 31, 2023, and each month thereafter, so long as the agreement is in full force and effect. The Option is exercisable at $0.20 per share, the closing price of BioLargo’s common stock on the March 21, 2023 grant date, expires ten years from the grant date, and was issued pursuant to the Company’s 2018 Equity Incentive Plan.

The Option is Mr. Dargan’s sole compensation for the Extended Term. As was the case in all prior terms of his engagement, there is no cash component of his compensation for the Extended Term. Mr. Dargan is eligible to be reimbursed for business expenses he incurs in connection with the performance of his services as the Company’s Chief Financial Officer (although he has made no such requests for reimbursement in the past). All other provisions of the Engagement Agreement not expressly amended pursuant to the Engagement Extension Agreement remain the same, including provisions regarding indemnification and arbitration of disputes.

2007 Equity Incentive Plan

On September 7, 2007, and as amended April 29, 2011, the BioLargo, Inc. 2007 Equity Incentive Plan (“2007 Plan”) was adopted as a means of providing our directors, key employees and consultants additional incentive to provide services. Both stock options and stock grants may be made under this plan for a period of 10 years, which expired on September 7, 2017. The Board’s Compensation Committee administers this plan. As plan administrator, the Compensation Committee has sole discretion to set the price of the options. As of September 2017, the Plan was closed to further stock option grants.

15

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

Activity for our stock options under the 2007 Plan for the three months ended March 31, 2023, and 2022 is as follows:

						Weighted
						Average		Aggregate
	Options		Exercise			Price per		intrinsic
	Outstanding		price per share			share		Value(1)
Balance, December 31, 2022		1,904,085	$0.28	–	0.69	$	0.56
Expired		–		–			–
Balance, March 31, 2023		1,904,085	$0.28	–	0.69	$	0.56	$	–
Balance, December 31, 2021		2,879,246	$0.23	–	0.94	$	0.49
Expired		–		–			–
Balance, March 31, 2022		2,879,246	$0.23	–	0.94	$	0.49

⁽¹⁾ – Aggregate intrinsic value based on closing common stock price of $0.20 at March 31, 2023.

Non-Plan Options issued

Activity of our non-plan stock options issued for the three months ended March 31, 2023 and 2022 is as follows:

							Weighted
	Non-plan						average		Aggregate
	Options			Exercise			price per		intrinsic
	outstanding			price per share			share		value(1)
Balance, December 31, 2022		19,023,829		$0.12	–	0.83	$	0.39
Granted		48,804			0.20			0.20
Balance, March 31, 2023		19,072,633		$0.12	–	0.83	$	0.39
Unvested		(507,500	)		0.45			0.45
Vested, March 31, 2023		18,565,133		$0.12	–	0.83	$	0.38	$	88,000
Balance, December 31, 2021		20,119,207		$0.12	–	0.83	$	0.39
Granted		32,609			0.23			0.23
Balance, March 31, 2022		20,151,816		$0.12	–	0.83	$	0.39

(1) – Aggregate intrinsic value based on closing common stock price of $0.20 at March 31, 2023.

During the three months ended March 31, 2023, we issued options to purchase an aggregate 48,804 shares of our common stock at $0.20 per share to vendors for fees for services. The fair value of the options issued totaled an aggregate $9,000 and is recorded in our selling, general and administrative expense.

During the three months ended March 31, 2022, we issued options to purchase an aggregate 32,609 shares of our common stock at $0.23 per share to vendors for fees for services. The fair value of the options issued totaled an aggregate $7,000 and is recorded in our selling, general and administrative expense.

16

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

Note 6. Warrants

We have certain warrants outstanding to purchase our common stock, at various prices, as described in the following table:

							Weighted
							average		Aggregate
	Warrants			Exercise			price per		intrinsic
	outstanding			price per share			share		value(1)
Balance, December 31, 2022		49,023,398		$0.13	–	1.00	$	0.26
Granted		7,512,000		0.21	–	0.29		0.25
Expired		(4,684,986	)	0.19	–	0.35		0.21
Balance, March 31, 2023		51,850,412		$0.13	–	1.00	$	0.26	$	122,000
Balance, December 31, 2021		36,765,562		$0.16	–	1.00	$	0.27
Granted		10,393,936		0.20	–	0.25		0.22
Expired		(388,889	)		0.22			0.22
Balance, March 31, 2022		46,770,549		$0.14	–	1.00	$	0.29

(1) – Aggregate intrinsic value based on closing common stock price of $0.20 at March 31, 2023.

Warrants issued in Unit Offerings

During the three months ended March 31, 2023, pursuant to our Unit Offerings (see Note 3), we issued six-month stock purchase warrants to purchase an aggregate 3,656,000 shares of our common stock at $0.228 per share, and five-year stock purchase warrants to purchase an aggregate 3,656,000 shares of our common stock at $0.285 per share.

During the three months ended March 31, 2022, pursuant to our 2020 Unit Offering (see Note 3), we issued six-month stock purchase warrants to purchase an aggregate 5,196,968 shares of our common stock at $0.204 per share, and five-year stock purchase warrants to purchase an aggregate 5,196,968 shares of our common stock at $0.25 per share.

Warrant issued in conjunction with amendment to note payable

On March 6, 2023, we entered into an agreement with the holder of a $50,000 note (see Note 4, “Convertible note payable, matures March 1, 2023”) to convert that note into common stock of BETI. As payment for interest, a warrant to purchase 200,000 shares of BioLargo common stock at $0.21 was issued to the investor, expiring five years from the grant date. The fair value of this warrant totaled $30,000 and was recorded as interest expense on our statement of operations.

Fair Value – Interest Expense

To determine interest expense related to our outstanding warrants issued in conjunction with debt offerings, the fair value of each award grant is estimated on the date of grant using the Black-Scholes option pricing model and the relative fair values are amortized over the life of the warrant. For the determination of expense of warrants issued for services, extinguishment of debt and settlement management also uses the option-pricing model. The principal assumptions we used in applying this model were as follows:

	2023			2022
Risk free interest rate	3.88	–	4.27%	3.69	–	3.88%
Expected volatility	40	–	95%		40%
Expected dividend yield		—			—
Forfeiture rate		—			—
Expected life in years	3	–	5		3

17

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

The risk-free interest rate is based on U.S. Treasury yields in effect at the time of grant. Expected volatilities are based on historical volatility of our common stock. The expected life in years is based on the contract term of the warrant.

Note 7. Accounts Payable and Accrued Expenses

As of March 31, 2023, accounts payable and accrued expenses included the following (in thousands):

Category	BioLargo		ONM		BLEST		Water		Intercompany amounts			Totals
Accounts payable	$	169	$	794	$	37	$	121	$	(82	)	$	1,039
Accrued payroll		36		49		75		—		—			160
Accrued interest		25		—		—		—		—			25
Total												$	1,224

As of December 31, 2022, accounts payable and accrued expenses included the following (in thousands):

Category	BioLargo		ONM		BLEST		Water		Intercompany amounts			Totals
Accounts payable	$	187	$	486	$	7	$	119	$	(82	)	$	717
Accrued payroll		20		58		120		—		—			198
Accrued interest		25		—		—		—		—			25
Total												$	940

See Note 8, “Accounts Payable and Accrued Expenses”, for the accounts payable and accrued expenses of Clyra Medical.

Note 8. Noncontrolling Interest – Clyra Medical

As discussed in Note 2 above, we consolidate the operations of our partially owned subsidiary Clyra Medical, of which we owned 58% of its outstanding shares as of March 31, 2023.

Debt Obligations of Clyra Medical

Promissory Note

On  April 8, 2022, Clyra Medical issued a promissory note in the principal amount of $100,000 to an individual investor, payable  April 8, 2024, and bearing 8% annual interest. The note  may be converted by its holder at any time prior to the maturity date, and automatically converts to stock upon (i) Clyra’s sale of $5,000,000 or more of its common or preferred stock, or (ii) the maturity date, at a conversion price equal to 70% of the lowest price-per-share of shares sold to a future investor prior to the maturity date.

Line of Credit

On June 30, 2020, Clyra Medical entered into a Revolving Line of Credit Agreement whereby Vernal Bay Capital Group, LLC committed to provide a $1,000,000 inventory line of credit. Clyra Medical received $260,000 in draws and made repayments totaling $113,000. Funds from the line of credit must be used to produce inventory. Additional draws are conditional upon the presentation of invoices or purchase orders to the lender equal to the greater of one-half of principal outstanding on the line of credit, and $200,000. The line of credit note earns interest at 15%, matures in one year, and requires Clyra pay interest and principal from gross product sales. For the first 6 months, Clyra is required to pay 30% of gross product sales to reduce amounts owed, and thereafter 60% of gross sales. Clyra issued Vernal Bay 322 shares of its common stock as a commitment fee for the line of credit, valued at $70,000. A security agreement of the same date grants Vernal Bay a security interest in Clyra’s inventory, as that term is defined in the Uniform Commercial Code. Clyra may prepay the note at any time.

18

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

On December 13, 2022, we entered into an amendment of the Revolving Line of Credit Agreement whereby the maturity date of the line of credit was extended to September 30, 2024, and the payment terms were modified such that amounts of principal due in each month are capped at a maximum of 15% of the principal amount then due under the note. Additionally, BioLargo agreed to allow Vernal Bay to elect to convert, any time prior to the note’s maturity date, the 322 shares of Clyra common stock it received as consideration for the line of credit into shares of Biolargo common stock at the then market price of BioLargo’s common stock. Vernal Bay elected to convert Clyra shares to 527,983 BioLargo shares of common stock.

As of March 31, 2023, the balance outstanding on this line of credit totals $147,000. As of December 31, 2022, the balance outstanding on this line of credit totaled $161,000.

Equity Transactions

As of December 31, 2022, Clyra had 91,149 common shares, and 2,800 Series A Preferred shares, outstanding. Of that amount, BioLargo owned 51,571 common shares, and 1,352 Series A Preferred shares. As of March 31, 2023, BioLargo owns 58% of Clyra’s issued and outstanding shares.

Sales of Common Stock

During the three months ended March 31, 2023, Clyra did not sell shares of its common stock. On March 2, 2022, BioLargo converted $633,091 owed to it by Clyra into 2,032 shares of Clyra common stock.

Sales of Series A Preferred Stock

During the three months ended March 31, 2023, Clyra sold 725 shares of its Series A Preferred Stock, and in exchange received $225,000 in gross and net proceeds. On December 20, 2022, Clyra sold 725 shares of its Series A Preferred Stock, and in exchange received $225,000 in gross and net proceeds, from two accredited investors. Purchasers of the Series A Preferred Stock also received a 3-year warrant to purchase the same number of additional shares of common stock for $372 per share. The fair value of the warrants issued totaled $110,000. Shares of Series A Preferred Stock earn a dividend of 15% each year, compounding annually; the company is under no obligation to pay such dividends in cash, and such dividends automatically convert to common stock upon conversion of the Series A Preferred Stock to common stock. Each share of Series A Preferred stock can be converted by the holder at any time for one share of common stock, and automatically convert upon the completion of a public offering of shares in which at least $5,000,000 of gross proceeds is received by the company. Accrued dividends may be converted to common stock at a conversion rate of $310 per share.

Each investor also entered into an agreement with BioLargo whereby the investor may exchange some or all of its Series A Preferred stock, plus accrued dividends, into shares of BioLargo common stock, at a price equal to a 20% discount of the volume weighted average price over the 30 prior trading days. Elections must be made during the 18-month period that begins 18 months after the closing of the Series A Preferred offering (which has not yet taken place), or June 30, 2023, whichever is earlier.

Clyra Stock Options

						Weighted
		Clyra				average
	Options		Exercise			price per
	Outstanding		price per share			share
Balance, December 31, 2022		15,833	$1.00	-	310	$	5.53
Granted		426	1.00	-	271		148.27
Balance, March 31, 2023		16,259	$1.00	-	310	$	9.27
Balance, December 31, 2021		14,004	$		1.00	$	1.00
Granted		648			1.00		1.00
Balance, March 31, 2022		14,652	$		1.00	$	1.00

19

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

Clyra issues options to its employees and consultants in lieu of compensation owed on a regular basis.  The fair value of the options issued in the three months ended March 31, 2023, and 2022 totaled $61,000 and $141,000, respectively. We used the Black-Scholes model to calculate the initial fair value, assuming a stock price on date of grant of $310 per share. Because Clyra is a private company with no secondary market for its common stock, the resulting fair value was discounted by 30%.

	March 31, 2023			December 31, 2022
Risk free interest rate	3.88	–	4.27%		2.32	%
Expected volatility		40%			40	%
Expected dividend yield		—			—
Forfeiture rate		—			—
Expected life in years		10			10

Accounts Payable and Accrued Expenses

At March 31, 2023, and December 31, 2022, Clyra had the following accounts payable and accrued expenses (in thousands):

Category	2023		2022
Accounts payable	$	235	$	186
Accrued payroll		6		45
Accrued interest		8		7
Accrued dividend		29		---
Total	$	278	$	238

The accrued dividend relates to the Series A Preferred Stock. Clyra is not required to pay accrued dividends in cash. The holder of Series A Preferred Stock may convert accrued dividends to common stock at any time. Any accrued dividends automatically convert to Clyra common stock upon conversion of the Series A Preferred Stock.

Note 9. BioLargo Engineering, Science and Technologies, LLC

In September 2017, we commenced a full-service environmental engineering firm and formed a Tennessee entity named BioLargo Engineering, Science & Technologies, LLC (“BLEST”). In conjunction with the start of this subsidiary we entered into employment agreements with six scientists and engineers. (See Note 11 “Business Segment Information”.) BLEST was capitalized with two classes of membership units: Class A, 100% owned by BioLargo, and Class B, held by management of BLEST, and which initially have no “profit interest,” as that term is defined in Tennessee law. However, over the succeeding five years, the Class B members can earn up to a 30% profit interest. They also have been granted options to purchase up to an aggregate 1,750,000 shares of BioLargo, Inc. common stock. The profit interest and option shares are subject to a five year vesting schedule tied to the performance of the subsidiary, including gross revenue targets that increase over time, obtaining positive cash flow by March 31, 2018 (which was not met), collecting 90% of its account receivables, obtaining a profit of 10% in its first year (and increasing in subsequent years) (which was not met), making progress in the scale-up and commercialization of our AOS system, and using BioLargo research scientists (such as our Canadian team) for billable work on client projects. These criteria are to be evaluated annually by BLEST’s compensation committee (which includes BioLargo’s president, CFO, and BLEST’s president), beginning September 2018. Given the significant performance criteria, the Class B units and the stock options will only be recognized in compensation expense if or when the criteria are satisfied.

20

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

The BLEST Compensation Committee has met regularly since the subsidiary commenced operations. In 2018, it reviewed the operating performance and determined that the performance metrics were not met and as a result, did not award any Class B units or stock options. In November 2019, it determined that a portion of the performance metrics were met, and that one-half of the eligible profits interests would be vested (2.5% in the aggregate), and therefore one-half of the option interests (10%) would be vested (175,000 options shares in the aggregate). The vesting of option shares resulted in a fair value totaling $44,000, recorded on our consolidated statement of operations as selling, general and administrative expense. The fair value of the profit interest was nominal and not booked. In January 2021, the committee again reviewed the operating performance and determined that a portion of the performance metrics were met. It was agreed that one-half and one-quarter of the eligible profit interests would be vested (3.75% in the aggregate), and therefore one-half of the option interests (15%) would be vested (262,500 options shares in the aggregate). The vesting of option shares resulted in a fair value totaling $65,000, recorded on our consolidated statement of operations as selling, general and administrative expense for the year ended December 31, 2020. In January 2022, the committee again reviewed the operating performance and determined that a portion of the performance metrics were met. It was agreed that an additional one-half and one-quarter of the eligible profits interests would be vested (11.25% in the aggregate), and therefore an additional half of the option interests would be vested (525,000 options shares in the aggregate). The vesting of option shares resulted in a fair value totaling $65,000, recorded on our consolidated statement of operations as selling, general and administrative expense for the year ended December 31, 2021. In December 2022, the committee again reviewed the operating performance and determined that a portion of the performance metrics were met. It was agreed that an additional one-half and one-quarter of the eligible profits interests would be vested (17.75% in the aggregate), and therefore an additional half of the option interests would be vested (1,242,500 options shares in the aggregate). The vesting of option shares resulted in a fair value totaling $135,000 and is recorded on our consolidated statement of operations as selling, general and administrative expense for the year ended December 31, 2022.

At March 31, 2023, BioLargo owns 82.25% of BLEST.

Note 10. BioLargo Energy Technologies, Inc.

Subsidiary BioLargo Energy Technologies, Inc. (“BETI”) was formed for the purpose of commercializing a sodium-sulfur battery technology.

During the three months ended March 31, 2023, BETI sold 325,000 shares of its common stock to six accredited investors for $2.00 per share. Of that amount, BioLargo purchased 50,000 shares for $100,000, and one investor converted a $50,000 note owed by BioLargo into 25,000 shares. Net proceeds from third parties totaled $550,000.

Each investor also entered into an agreement with BioLargo whereby the investor may exchange some or all of its shares of BETI common stock into shares of BioLargo common stock, at a price equal to a 20% discount of the volume weighted average price over the 20 trading days prior to the election to exchange. Elections must be made during calendar year 2024.

As of March 31, 2023, there are 9,325,000 shares outstanding, of which BioLargo holds 9,050,000.

Note 11. Business Segment Information

BioLargo currently has four operating business segments, plus its corporate entity which is responsible for general corporate operations, including administrative functions, finance, human resources, marketing, legal, etc. The four operational business segments are:

1. ONM Environmental -- which sells odor and volatile organic control products and services (located in Westminster, California);

2. Clyra Medical Technologies (“Clyra Medical”) -- which develops and sells medical products based on our technologies;

3. BLEST -- which provides professional engineering services on a time and materials basis for outside clients and supports our internal operations as needed (located in Oak Ridge, Tennessee); and

4. BioLargo Water (“Water”) -- which historically focused entirely on R&D, and has now shifted its focus to commercializing the AOS technology (located in Edmonton, Alberta Canada).

5. BioLargo Energy Technologies, Inc. (“BETI”) – formed to commercialize a sodium-sulfur battery technology.

Other than ONM Environmental during the last three quarterly periods, none of our operating business units have operated at a profit,  and therefore each required additional cash to meet its monthly expenses, funded through BioLargo’s sales of debt or equity, research grants, and tax credits. BETI and Clyra Medical have also been funded by third party investors who invest directly in exchange for equity ownership in that entity.  

The segment information for the three months ended March 31, 2023, and 2022, is as follows (in thousands):

March 31, 2023	BioLargo			ONM			Clyra			BLEST			Water			BETI			Elimination			Total
Revenue	$	—		$	3,543		$	6		$	363		$	—		$	—		$	(170	)	$	3,742
Intersegment revenue		—			—			—			(170	)		—			—			170			—
R&D expense		(189	)		—			(134	)		(245	)		(135	)		(32	)		170			(565	)
Operating income (loss)		(799	)		1,387			(426	)		(368	)		(184	)		(87	)		—			(477	)
Grant income		—			—			—			—			31			—			—			31
Interest expense		(36	)		(2	)		(10	)		—			—			—			—			(48	)
Net income (loss)		(835	)		1,385			(436	)		(368	)		(153	)		(87	)		—			(494	)

21

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

March 31, 2022	BioLargo			ONM			Clyra			BLEST			Water			Elimination			Total
Revenue	$	2		$	600		$	10		$	545		$	—		$	(188	)	$	965
Intersegment revenue		(2	)		(2	)		—			(188	)		—			192			—
Research and development		(265	)		—			(16	)		(108	)		(197	)		194			(392	)
Operating loss		(1,220	)		13			(240	)		(35	)		(228	)		—			(1,710	)
Grant income		—			—			—			—			5			—			5
Interest expense		(6	)		—			(7	)		—			—			—			(13	)
Net income (loss)		(1,226	)		187			(247	)		(35	)		(223	)		—			(1,544	)

As of March 31, 2023	BioLargo		ONM		Clyra		BLEST		Water		BETI		Elimination			Total
Tangible assets	$	530	$	3,392	$	578	$	505	$	223	$	628	$	(73	)	$	5,783
Right of use (leased assets)		114		—		—		723		—				—			837
Investment in South Korean joint venture		27		—		—		—		—				—			27
Total	$	671	$	3,392	$	578	$	1,228	$	223	$	628	$	(73	)	$	6,647

As of December 31, 2022	BioLargo		ONM		Clyra		BLEST		Water		Elimination			Total
Tangible assets	$	669	$	2,064	$	631	$	441	$	194	$	(41	)	$	3,958
Right of use (leased assets)		136		—		—		731		—		—			867
Investment in South Korean joint venture		33		—		—		—		—		—			33
Total	$	838	$	2,064	$	631	$	1,172	$	194	$	(41	)	$	4,858

22

BIOLARGO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

Note 12. 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. Short-term leases less than one-year are not included in our analysis. For the three months ended March 31, 2023, and 2022, rental expense was $83,000 and $63,000. The lease of our Westminster facility expires  August 2024. Management has not yet determined whether it will exercise its option to extend the lease four years; therefore the four-year extension is not included in the analysis. In  September 2022, the lease of our Oak Ridge, Tennessee facility was extended for ten years. 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. The leases have no additional payment terms such as common area maintenance payments, tax sharing payments or other allocable expenses. Likewise, the leases do not contain other terms and conditions of use, such as variable lease payments, residual value guaranties or other restrictive financial terms. Since there is no explicit interest rate in our leases, management used its incremental borrowing rate, which is estimated to be 18% to determine lease liability.  

Note 13. Subsequent Events.

Management has evaluated subsequent events through the date of the filing of this quarterly report and management noted the following for disclosure.

Lincoln Park Capital Purchase of Shares

From April 1, 2023, through May 12, 2023, we sold 567,713 shares of common stock to Lincoln Park pursuant to the 2022 LPC Purchase Agreement (see Note 3) and received $101,000 in gross and net proceeds. These sales were registered with the SEC on Form S-1 (file number 333-268973).

Clyra Medical – Series A Preferred

From April 1, 2023, through May 12, 2023, Clyra Medical sold 401 shares of its Series A Preferred Stock, and in exchange received $124,000 in gross and net proceeds. Purchasers of the Series A Preferred Stock also received a 3-year warrant to purchase the same number of additional shares of common stock for $372 per share. Each investor also entered into an agreement with BioLargo whereby the investor may exchange some or all of its Series A Preferred stock, plus accrued dividends, into shares of BioLargo common stock, at a price equal to a 20% discount of the volume weighted average price over the 30 prior trading days. (See Note 8, “Sales of Series A Preferred Stock”.)

23

 

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This quarterly report on Form 10-Q contains forward-looking statements. These forward-looking statements involve risks and uncertainties, including statements regarding BioLargo’s capital needs, business plans and expectations. Such forward-looking statements involve risks and uncertainties regarding BioLargo’s ability to carry out its planned development and production of products. Forward-looking statements are made, without limitation, in relation to BioLargo’s operating plans, BioLargo’s liquidity and financial condition, availability of funds, operating and exploration costs and the market in which BioLargo competes. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may”, “will”, “should”, “expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict”, “potential” or “continue”, the negative of such terms or other comparable terminology. Actual events or results may differ materially. In evaluating these statements, you should consider various factors, including the risks outlined in our Form most recent annual report on Form 10-K, and, from time to time, in other reports BioLargo files with the SEC. These factors may cause BioLargo’s actual results to differ materially from any forward-looking statement. BioLargo disclaims any obligation to publicly update these statements, or disclose any difference between its actual results and those reflected in these statements. The information constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements.

Unless otherwise expressly stated herein, all statements, including forward-looking statements, set forth in this Form 10-Q are as of March 31, 2023, unless expressly stated otherwise, and we undertake no duty to update this information.

As used in this report, “we” and “Company” refers to (i) BioLargo, Inc., a Delaware corporation; and (ii) its partially or wholly-owned subsidiaries BioLargo Life Technologies, Inc., a California corporation which holds our registered patents, ONM Environmental, Inc., a California corporation which manufactures, markets, sells and distributes our odor and volatile organic compound control products, BioLargo Water Investment Group, Inc., a California corporation (which wholly owns BioLargo Water, Inc., a Canadian corporation), BioLargo Development Corp., a California corporation which employs and provides benefits to our employees, BioLargo Engineering, Science & Technologies, LLC, a Tennessee limited liability company (“BLEST”) that provides professional engineering services out of Oak Ridge Tennessee, BioLargo Energy Technologies, Inc., a California corporation (“BETI”) formed to commercialize our proprietary battery technology, BioLargo Equipment Solutions & Technologies, Inc., a California corporation, and Clyra Medical Technologies, Inc., a California corporation (“Clyra Medical”) which commercializes our technologies in the medical and dental fields. All subsidiaries are wholly owned, except for BETI, BLEST and Clyra Medical.

The following discussion and analysis should be read in conjunction with our unaudited consolidated financial statements and the related notes to the consolidated financial statements included elsewhere in this report.

Our Business - Innovator and Solution Provider

BioLargo, Inc. invents, develops, and commercializes innovative platform technologies to solve challenging environmental problems like PFAS contamination (per- and polyfluoroalkyl substances), advanced water and wastewater treatment, industrial odor control, air quality control, infection control, and myriad environmental remediation challenges. Having conducted continual and extensive research and development, BioLargo holds a wide array of issued patents, maintains a robust pipeline of products, and provides full-service environmental engineering. With a keen emphasis on partnerships with academic, government, and commercial organizations and associations, BioLargo has proven itself by executing on challenging environmental engineering projects, demonstrating its powerful technologies through pilots, trials, and early commercial adoption, publishing high-impact academic and industry publications, and winning over 90 grants. We monetize our innovations through direct sales and recurring service contracts, as well as through channel partnerships, meaning licensing agreements, exclusive and non-exclusive distribution agreements, brand development partnerships, sale referral partnerships, strategic joint venture formation, and/or the sale of the IP. Channel partnerships allow us to extend the commercial reach of our products and services disproportionately to our core infrastructure and staffing.

24

Our revenues increased 288% in the three months ended March 31, 2023, as compared with the same period in 2022, having more than doubled in the year ended December 31, 2022, as compared with the year ended December 31, 2021. The standout has been the pet odor product (brand name “Pooph”) sold by our consumer packaged goods partners at Ikigai Marketing Works, whose sales contributed significantly to the record product revenues of our odor and VOC control products division ONM Environmental, and comprised 86% of our revenues in the quarter.

We have several key ongoing projects that Company management believes will stimulate accelerated growth through 2023. These are:

● The launch in major retailers of the Pooph pet odor control product by our consumer packaged goods partners at Ikigai.

● Our first PFAS removal project at a large industrial site (announced in August 2022), currently in the initial phase of a multi-phase process, which we expect to continue advancing as we engineer a comprehensive PFAS mitigation plan.

● Expanded commercial roll-out of our PFAS treatment technology through a growing network of sales rep organizations.

● Garratt-Callahan’s launch of the jointly developed minimal liquid discharge wastewater treatment product.

● Our engineering work with Ultra Safe Nuclear.

● Our engineering services division’s engagements as consultants to support large capital projects which are sponsored and or financed by the customers.

Technology

We have continually advanced our portfolio of technologies since the first acquisition of early iterations of the BioLargo technology in the spring of 2007. Our innovations have primarily been developed through our internal resources, and some through acquisition. These include patents, patents pending, and trade secrets that include solutions for:

● Water decontamination, including:

o Removal of per- and polyfluoroalkyl substances (PFAS) and chlorides from drinking and ground water

o Micro-pollutant destruction and removal

o Legionella detection and water treatment solutions

o Minimum and zero liquid discharge systems (MLD/ZLD)

o Disinfection

o Electro-oxidation

● Battery energy storage

● Air quality controls and systems including odor and VOC control

● Mineral processing

● Infection control

● Wound management

● Disinfection

Talent

We have grown our team to 33 team members and numerous other part-time consultants, including highly qualified PhDs, engineers, MDs and medical professionals, construction professionals, field service technicians, innovators, sales marketing specialists, entrepreneurial and executive leadership.

25

Purpose

Our mission to make life better drives us to serve others with integrity, knowledge, technology, and solutions that protect the environment, improve quality of life, and protect lives. Most of our technologies were developed from the ground-up to be sustainable, practical solutions to significant global challenges. We are unique in our ability to tailor our offerings to serve our customers with proven expertise, proven technology and, if needed, we often have the ability to develop new technical solutions to meet our customers’ needs.

Combating the PFAS Forever-Chemical Crisis – the AEC

One of the most significant and timely innovations in our portfolio is our per- and polyfluoroalkyl substances (PFAS) removal and collection/disposal solution we call the Aqueous Electrostatic Concentrator (AEC). Our engineers developed and are now commercializing the AEC, which is a novel water treatment system that removes PFAS from water at a lower operating cost and generating only a fraction of the PFAS-laden waste of the most common currently used solutions (carbon filtration, ion exchange, and reverse osmosis). PFAS chemicals have been linked to cancer, immune disorders, liver dysfunction, and many other human health problems, and are contained in a vast range of manufactured goods, common household products (e.g., cleaning products, cookware), and electronics, and contaminate drinking water in unsafe levels all over the globe.

PFAS is often referred to as the “contaminant of the decade”, and as such, it is considered a multi-billion dollar commercial market opportunity. The EPA proposed new drinking water standards on March 14, 2023, limiting certain PFAS chemicals to four parts per trillion – a standard our AEC can meet. We believe these proposed rules will continue to push the market to find and adopt commercially viable solutions to remove PFAS chemicals from water. Additionally, some emerging regulations on PFAS in the U.S. are expected to skew the market toward seeking treatment technologies that produce as little PFAS-laden solid waste as possible, a favorable trend for our AEC that generates very little PFAS-laden waste. Detection of unsafe levels of PFAS around the world has given rise to a number of market opportunities, including in drinking water, industrial wastewater, municipal wastewater, solid waste, organic foods and more.

We have successfully validated the AEC as an effective system to selectively extract and collect PFAS chemicals from contaminated water including performance testing that shows “non-detect” levels of removal, which meets new EPA standards. We have demonstrated more than nine months of continuous operation showing no materially significant degradation of the AEC system’s components or performance over time. As a modular system, we believe the AEC is scalable to a commercial scale, and we believe that our engineering team has the experience to deliver systems to meet the needs of a commercial installation.

In August 2022, we began engineering a comprehensive PFAS mitigation plan for client operating an industrial site. The initial preliminary engineering phase and project budgeting is complete. We recently delivered a proposal for a system that will serve as a mobile commercial pilot, and scoping, preliminary design and budget for the building of the full-scale system.

The AEC’s commercial roll-out will be executed with the help of a network of sales representative organizations whose role will be to market and sell the treatment system, related equipment, and the Company’s engineering services to municipal and industrial customers across the country. We have secured channel partner agreements with several sales representative organizations ensuring coverage for most of the continental United States.

In October 2022, we entered into a channel partner agreement with Product Recovery Management, Inc. to sell, distribute and act as a contract manufacturer for the AEC and other BioLargo water treatment technologies. Product Recovery Management (PRM), based out of Butner, NC, is a UL-certified equipment integrator specializing in remediation services with over 40 years of history serving customers. PRM designs and manufactures treatment systems that address a wide variety of contamination challenges in the remediation and landfill industries, including PFAS contamination. Their Butner operations include a 250,000 square foot manufacturing facility with large-scale fabrication capabilities.

We are also in negotiations with multiple prospective industrial and municipal customers to treat PFAS contaminated water.  In light of the fact that we now have our first commercial project under contract, we believe that our expected success with an industrial customer will be a key factor to help advance marketing efforts in the municipal market as well as potentially minimizing the need for small scale field piloting, which can be expensive and time consuming.

26

ONM Environmental - Industrial Odor and VOC Solutions

ONM Environmental, Inc. is BioLargo’s subsidiary that delivers robust and comprehensive products and services to control and mitigate odor and volatile organic compounds (“VOCs”) emitted from a variety of industrial activities, including landfills and other waste handling facilities. Its flagship product – CupriDyne® Clean – reduces and eliminates tough odors and VOCs in various industrial settings. CupriDyne® Clean is delivered through misting systems, sprayers, water trucks and similar water delivery systems designed, manufactured and installed by ONM. We believe the product is the number-one performing odor-control product in the market, and that it offers substantial savings to our customers compared with competing products. ONM Environmental holds General, Electrical, Plumbing and Low Voltage contractor licenses issued by the California Contractors State License Board, and offers a menu of services to landfills, transfer stations, wastewater treatment facilities as well as facilities in non-waste related industries. These services include engineering design, construction, installation, ongoing maintenance and on-site support services to assist our clients in the implementation and continued use of the various systems that deliver our liquid products in the field (such as misting systems).

We have been and expect to continue selling product to the largest solid waste handling companies in the country, with a portion of chemistry product sales resulting from national purchasing agreements (NPAs), and are also serving municipalities.

In addition to its goal to keep growing its revenues organically through the sale of odor and VOC control chemistry and air quality control systems to its primary market segment (municipal solid waste handling in California), ONM Environmental aims to accelerate its growth through development of new sales and distribution channels without being limited by our own sales and distribution infrastructure, such as through our partnership with Ikigai Marketing Works, LLC (see “Consumer Packaged Goods Products” below).

Consumer Packaged and Private-Label Products

We sell pet odor-control products under the brand “Pooph” to Ikigai Marketing Works, LLC. After a successful test marketing phase, they have been executing a national advertising campaign through extensive television and internet advertising and have launched the product for web sales on their own website and on Amazon. In late 2022, Ikigai launched the Pooph product in a limited number of Walmart retail stores, expanding to Walmart stores nationwide in the second quarter of 2023. Our agreement with Ikigai grants them an exclusive license to sell the Pooph pet odor-control product, and requires, in addition to purchasing product from us at an agreed-upon manufacturing margin, they are required to pay us an additional six percent of their sales.

As Ikigai has expanded their national television advertising, their sales have increased, and correspondingly, their purchase of product from us has increased, such that for the three months ended March 31, 2023, it comprised 86% of our total (company-wide) revenue.

South Korean Joint Venture

In February 2020 we executed a “Joint Venture Framework Agreement” with a leading wastewater treatment solution provider based in South Korea (BKT Co. Ltd., “BKT”), to create a South Korean entity that would manufacture odor and VOC control products based on our CupriDyne® Clean products. We own 40% of the joint venture. Although the joint venture established manufacturing and is marketing the product, the COVID-19 pandemic significantly impacted the expected growth of the company. While the management team continues to market the product to industrial clients, their efforts have struggled to gain a foothold, and we are in discussions to expand their license to allow for the sale of consumer products.

27

Full Service Environmental Engineering

BioLargo Engineering, Science & Technologies, LLC (“BLEST”) offers full service environmental engineering to third parties and provides engineering support services to our internal teams to accelerate the commercialization of our technologies.

BLEST focuses its efforts in three areas:

● providing engineering services to third-party clients;

● supporting internal product development and business units’ services to customers (e.g., the AOS); and

● advancing their own technical innovations such as the AEC PFAS treatment technology and the battery energy storage system which was recently added to the portfolio.

The subsidiary is located in Oak Ridge (a suburb of Knoxville, Tennessee), and employs a group of scientists and engineers, many of whom are owners of the entity (BioLargo owns 82.25%). The team is led by Randall Moore, who served as Manager of Operations for Consulting and Engineering for the Knoxville office of CB&I Environmental & Infrastructure and was formerly a leader at The Shaw Group, Inc., a Fortune 500 global engineering firm. Many of the other team members are also former employees of CB&I and Shaw, with the exception of more recent staff hires. We believe the team is highly experienced across multiple industries and are considered experts in their respective fields, including: chemical engineering, wastewater treatment (including design, operations, data gathering and data evaluation), process safety, energy efficiency, air pollution, design and control, technology evaluation, technology integration, air quality management & testing, engineering management, permitting, industrial hygiene, applied research and development, air testing, environmental permitting, HAZOP review, chemical processing, thermal design, computational fluid dynamics, mechanical engineering, mechanical design, NEPDES permitting, RCRA/TSCA compliance and permitting, project management, storm water design & permitting, computer assisted design (CAD), bench chemistry, continuous emission monitoring system operator, data handling and evaluation and decommissioning and decontamination of radiological and chemical contaminated facilities. The team has decades of high-level experience in the energy industry. The engineering team has also developed an extended network of trusted engineering subcontractors that assist in serving specific client projects as needed.

In association with Garratt-Callahan, a national industrial water treatment company, BLEST developed a “minimal liquid discharge” (MLD) wastewater treatment system based on Garratt-Callahan’s patented technology that is able to reduce industrial wastewater discharge and therefore reduce wastewater discharge fees for customers. Garratt-Callahan is currently marketing the MLD system to its customers. BLEST will serve as the manufacturing partner and Garratt-Callahan will serve as the selling distributor to leverage their national sales force and over one hundred years of providing services and products to customers. BioLargo’s engineers completed the first full-scale prototype of this new technology and tested it with Garratt-Callahan client provided water, with Garratt-Callahan technical staff present on-site at BLEST’s facility. In this “factory acceptance” testing, the system removed over 98% of the target contaminants from water in continuous operation, in line with results achieved by Garratt-Callahan’s original bench-scale and batch processing tests. This factory acceptance testing was a necessary step before commercial trials and/or sales to Garratt-Callahan customers could begin. Garratt-Callahan has identified multiple customer prospects, as has BioLargo, through its own marketing efforts. We remain confident that this innovation and partnership will find commercial success.

In the second quarter of 2022, BLEST was contracted by Ultra Safe Nuclear to assist in producing the first prototype fuel production systems for their new nuclear reactor called the Micro Modular Reactor (MMR®). Ultra Safe Nuclear is a Seattle-based nuclear energy company that has invented a “fission battery” - a fourth generation modular nuclear reactor – that can deliver safe, zero-carbon, cost-effective energy anywhere. The MMR® uses ceramic-encapsulated nuclear fuel – Fully Ceramic Micro-encapsulated (FCM+++) – an extremely rugged and stable fuel with high temperature stability. BioLargo has been retained to provide engineering design support, fabrication, and integration for the company’s prototype fuel production systems. Because of the success of the early phase of the project, this project is expected to expand over the coming months in scope and significance to BioLargo, making them an important customer for BLEST.

28

Waste-to-Energy Conversion Plant Project

In April 2022, our engineering subsidiary was hired by a Southern California based sustainable energy services company to conduct a comprehensive project plan (i.e., “feasibility study”) for a waste-to-energy (WTE) conversion plant in South America – one of multiple projects in planning stages by the company. Our engineers completed the initial feasibility study and have delivered a proposal for the next phase of the project (front end engineering design, aka FEED). The client has also requested feasibility studies and a FEED proposal for WTE plants in Asia.

BioLargo Water and the Advanced Oxidation System – AOS

BioLargo Water is our wholly owned subsidiary located in Edmonton, Alberta, Canada, which has and is commercializing our Advanced Oxidation water treatment system (AOS). The AOS is our patented water treatment device that generates highly oxidative and energetic species of iodine and other molecules which allow it to eliminate pathogenic organisms and organic contaminants rapidly and effectively as water passes through the device. The key value proposition of the AOS is its ability to reduce or eliminate a wide variety of waterborne contaminants with high performance while using very little electricity and input chemicals. This is made possible by the highly oxidative iodine compounds and reactive oxygen species generated within the AOS reactor as well as the unique and proprietary physical constitution and geometry of the reactor. Our proof-of-concept studies and on-site pilot projects have generated results that project the AOS will be more cost- and energy-efficient than commonly used advanced water treatment technologies such as UV, electro-chlorination, and ozonation. Furthermore, our technology has been proven capable of removing hard-to-treat organic micropollutants such as pharmaceuticals from water more quickly and energy-efficiently than other technologies. Together, these characteristics make the AOS an economical and versatile tool to enable wastewater treatment and reuse in the face of emerging water contaminants and increasing regulatory scrutiny on industrial wastewater discharge. The capabilities of the AOS as a sustainable water treatment technology have been the subject of several high-impact academic papers in scientific journals. The company pursues a policy of publishing about the technology in academic journals as much as possible in order to promote transparency about the technology’s safety and efficacy while also contributing to the field of advanced water treatment science. In June of 2022, the fourth peer-reviewed scientific paper about the AOS was published, in the journal Environmental Science and Pollution Research.

In the first quarter of 2022, BioLargo Water received a grant from Next Generation Manufacturing Canada (NGen) to support the company’s collaboration with a specialized electrical component designer to assist in optimizing the electrical performance of the AOS with the ultimate goal of maximizing the lifespan of the AOS’ components. In the second quarter of 2022, the development work funded by this grant advanced, focusing on improving the performance of the conductive materials within the AOS which allow for water disinfection and decontamination.

The AOS has been included as a component of treatment train (comprehensive system) for a number of projects being scoped and budgeted through our engineering subsidiary. In addition, it has been included in the catalog of offerings being sold through our independent representatives as well as channel partners.

Municipal Wastewater Treatment Pilot – Montreal

Our commercial-scale AOS demonstration pilot (run in partnership with water experts at the Centre des Technologies de L’Eau) at a municipal wastewater treatment plant near Montreal, Quebec, is ongoing and providing important data that shows the AOS is removing five target pharmaceuticals from the wastewater faster and using less electricity than the ultraviolet (UV) disinfections system used in the facility. Notably, the pilot project also showed that the AOS was able to also remove total coliforms (bacteria) from the municipal wastewater more effectively than the UV disinfection system currently in use at the facility.

In January 2022, BioLargo Water was awarded a grant from the government of Canada’s Natural Sciences and Engineering Research Council (NSERC) that allowed for the extension of the pilot project to allow for use of a new, higher flow-rate AOS system, as well as the installation of an AEC system at the pilot to assess its removal of PFAS chemicals from the municipality’s wastewater, which was completed successfully.

29

Clyra Medical Technologies

Clyra Medical Technologies, Inc. is our partially owned subsidiary creating medical products based on our technology. It is launching a product to be used by surgeons generally, with a first target market aimed toward orthopedic surgeons for use as a wound irrigation solution and to help manage patient care and outcomes and, for wound care. Clyra has secured its first two hospital customers for the product, established a robust quality control system for FDA compliance, recruited a national director of sales, and is negotiating with three separate channel partners to form a commercial alliance. It has secured its first manufacturer’s representatives and is actively expanding these efforts to build out a national rep network. Its other product designs are on hold until such time as it is able to secure the capital and resources to complete any final development and support additional inventory, technical support and sales for these products. There are channel partnerships in development for Clyra’s Bioclynse product in three separate healthcare markets.

BioLargo Energy Technologies, Inc.

BioLargo acquired a proprietary sodium-sulfur battery technology and has formed and secured initial seed capital for a subsidiary – BioLargo Energy Technologies, Inc. (“BETI”) – designed to address the ongoing shift toward renewable energy production and the growth in global electricity demand, and the consequent drastic expansion in energy storage capacity in the US and world-wide that will be needed to accommodate increased demand and the intermittent nature of renewable energy sources like wind and solar.

The initial capital raised – $650,000 – will be used to construct prototype batteries. These batteries will be tested to confirm energy efficiency, useful life expectancy, energy density, safety profile, number of charge/discharge cycles, and other technical claims that differentiate the battery from incumbent technologies. Batteries built based on the underlying technology a decade ago demonstrated features that far surpass comparable lithium-ion batteries, the dominant incumbent technology in the market:

● This sodium-sulfur battery technology demonstrates increased safety, no runaway fire risks, and a more sustainable design – with no rare-earth elements – that is capable of being manufactured completely from the domestic supply chain.

● Unlike lithium-ion batteries, BioLargo’s battery can charge and discharge completely, with no degradation of performance, ensuring virtually unlimited charge/discharge cycles, without self-discharge.

● BioLargo’s battery technology also demonstrates increased energy efficiency and energy density in comparison to lithium-ion batteries, and a longer useful life expectancy of at least 10 years.

BioLargo’s battery uses common, inexpensive, domestically available materials, and through its unique design and manufacturing process, creates an energy storage solution that has higher energy density than lithium virtually unlimited charge/discharge cycles, stable and secure supply chain management, and which is far safer than lithium-ion batteries, the current dominant energy storage technology. While the concept of sodium-sulfur salt batteries is not new (a concept conceived more than 80 years ago), we are not aware of any known ‘salt’ battery that can match the performance metrics of our battery.

Our battery technology operates at higher temperatures, and its casing and materials when combined, are heavier than lithium-ion, making it more suitable for stationary energy storage applications like grid-scale energy storage, electric vehicle charging stations, and commercial and residential energy storage, and believed to be less suitable for placement into electric vehicles or portable electronics. We are currently building out facilities to manufacture prototype batteries in our Oak Ridge Tennessee operations.

Results of Operations

We operate our business in distinct business segments:

● ONM Environmental, which manufactures and sells our odor and VOC control products and services for sale by itself and third parties through private labels;

30

● BLEST, our professional engineering services division, advancing innovations like the AEC to remove PFAS contaminants from water, serving outside clients on a fee for service basis, and supporting our internal business units;

● Clyra Medical, our partially owned subsidiary which develops and sells medical products based on our technology;

● BioLargo Water, our Canadian division that has been historically pure research and development, and is now transitioning to focus on commercializing our AOS system; and

● Our corporate operations, which support the operating segments with legal, accounting, human resources, and other services.

Consolidated revenue for the three months ended March 31, 2023, was $3,742,000, a 288% increase over the same period in 2022, and a 78% increase over the prior quarter (ended December 31, 2022). Our revenue from product sales and related services increased by 482%, while our service revenue decreased by 45%.

ONM Environmental

Our wholly-owned subsidiary ONM Environmental generates revenues through (i) sales of our flagship product CupriDyne Clean, including related design, installation, and maintenance services on the systems that deliver CupriDyne Clean at its clients’ facilities, and (ii) sale of private-label products to third parties.

Revenue (ONM Environmental)

ONM Environmental’s revenues increased 491% (to $3,543,000) in the three months ended March 31, 2023, compared with the same period in the prior year. Revenues in the quarter were comprised primarily of $3,218,000 in revenues to one customer selling private label products, and $431,000 in revenues of its industrial odor-control product CupriDyne Clean.

The increase in revenues was almost entirely due to an increase in the volume of sales of private label odor-control products, specifically the Pooph branded pet-odor product purchased by Ikigai, which comprised 91% of ONM Environmental’s revenue total. Because ONM Environmental has no control over Ikigai’s marketing and sales activity of Pooph, it cannot predict its sales of the product to Ikigai in future periods. Ikigai has indicated their intentions to continue their national advertising campaign as they place the product in national retail chains, including the introduction of the product in Walmart nationally. Their execution of those future plans has inherent risks that are out of our control. (See Part II, Item 1A, and the risk factor titled “A significant portion of our revenue is concentrated with one customer.”) Given the foregoing, management cannot be certain of the continued purchase of the Pooph product by Ikigai. Their failure to continue to purchase product would have a material impact on ONM Environmental’s revenues.

Industrial odor-control revenues increased 42% in the three months ended March 31, 2023, compared with the same period in the prior year, and increased 16% compared with the prior quarter (ended December 31, 2022).

Cost of Goods Sold (ONM Environmental)

ONM Environmental’s cost of goods sold includes costs of raw materials, contract manufacturing, and portions of depreciation, salaries and expenses related to the manufacturing and installation of its products. As a percentage of revenue, ONM Environmental’s costs of goods decreased 3% for the three months ended March 31, 2023, to 49%, compared to the same period in 2022, due to increased sales. Cost of goods sold increased 2% from the prior three months ended December 31, 2022. The fluctuation in cost of goods is due our efforts to improve margins in in our private-label products, and increases in raw material costs.

Selling, General and Administrative Expense (ONM Environmental)

ONM Environmental’s selling, general and administrative expenses increased by 22% ($65,000) during the three months ended March 31, 2023, as compared with the same period in 2022. These expenses increased due to a increase of sales and support staff. We expect these expenses to increase to add support if revenue continues to increase in the year ending December 31, 2023.

Operating Income (ONM Environmental)

ONM Environmental generated operating income of $1,387,000 in the three months ended March 31, 2023, compared to operating income of $13,000 in 2022. The generation of operating income this past quarter was entirely dependent on sale of Pooph product to Ikigai.

31

BLEST (engineering division)

Revenue (BLEST)

Our engineering segment (BLEST) generated $193,000 of revenue in the three months ended March 31, 2023, net of intersegment revenue, compared to $357,000 in 2022, representing a 45% decrease. The decrease is due to a decrease in the number of client contracts, an increase in intercompany services, and multiple clients delaying the start of projects.

In addition to providing services to third party clients, BLEST provides services to BioLargo and its subsidiaries for internal BioLargo projects. These services are billed internally, are considered intersegment revenue, and are eliminated in the consolidation of our financial statements. In the three months ended March 31, 2023, intersegment revenue for BLEST totaled $170,000, consisting primarily of research and development to further our flagship AOS water filtration system and our AEC PFAS treatment system. In addition, BLEST engineers are performing a critical role in the AOS pilot projects, some of which are supported by third-party research grants and has been instrumental in developing and supporting a professional engineered design service for misting systems being sold by our ONM operating unit.

Cost of Goods (Services) Sold (BLEST)

BLEST’s cost of services includes employee labor as well as subcontracted costs. In the three months ended March 31, 2023, cost of services were 69% of its revenues, versus 42% in the same period in 2022. This increase is due to contracts with reduced margins and the reduction in overall revenue, as well as the recognition of deferred revenue in the three months ended March 31, 2022, which did not occur in the same period in 2023.

Selling, General and Administrative Expense (BLEST)

BLEST SG&A expenses were $184,000 in the three months ended March 31, 2023, compared to $134,000 in 2022, primarily due to increased rental costs and staff.

Operating Loss (BLEST)

BLEST incurred an operating loss of $368,000 in the three months ended March 31, 2023, compared to an operating loss of $35,000 in 2022.

Because the subsidiary had an operating loss, we invested cash during the year to allow it to maintain operations. BLEST’s need for a cash subsidy to support its operations has decreased over time. Our goal for this operation is that it produces a profit and contributes to corporate overhead in a significant way, although predicting when that will happen and other uncertainties in the market, and our limited resources, is difficult.

Clyra Medical

Clyra Medical generated $6,000 in revenues in the three months ended March 31, 2023, total costs and expenses of $431,000, including $134,000 in research and development expenses, and an operating loss of $426,000. In the same period in 2022, it generated $11,000 in revenue, had total costs and expenses of $250,000, including $16,000 in research and development expenses, and an operating loss of $239,000. Clyra has been limited in terms of capital resources, and its level of activity has been largely dependent on available cash.

BETI

Formed to develop and commercialize a sodium-sulfur battery technology, BETI raised $650,000 in investment capital in the three months ended March 31, 2023, did not generate revenue, and incurred $87,000 in expenses, primarily related to the build out of space to manufacture battery prototypes.

Selling, General and Administrative Expense – consolidated

Our Selling, General and Administrative expense (“SG&A”) include both cash (for example, salaries to employees) and non-cash expenses (for example, stock option compensation expense). Our consolidated SG&A decreased in the aggregate by 6% ($113,000) in the three months ended March 31, 2023, to $1,722,000.  Our non-cash expenses (through the issuance of common stock, warrants, and stock options) decreased in the three months ended March 31, 2023 compared with 2022 ($463,000 compared to $822,000) , which accounted for the largest decline in salaries and consulting expense. The largest components of our SG&A expenses included (in thousands):

	Three months ended March 31, 2023		Three months ended March 31, 2022
Salaries and payroll related	$	636	$	809
Professional fees		210		149
Consulting		198		316
Office expense		427		310
Board of director expense		65		111
Sales and marketing		93		59
Investor relations		93		85

In the three months ended March 31, 2023, our non-cash expenses from stock for service, stock options and warrant expense total $496,000. In the three months ended March 31, 2022, our non-cash expenses from stock for service, stock options and warrant expense total $822,000.

32

Research and Development

In the three months ended March 31, 2023, we spent $565,000 in the research and development of our technologies and products. This was an increase of 44% ($173,000) compared to 2022. The increase is related to headcount and work at BETI.

Interest expense

Our interest expense for the three months ended March 31, 2023, was $48,000, compared with $13,000 in the same period in 2022. Of our total interest expense in 2023, $15,000 was paid in cash, and the remainder was comprised primarily of non-cash debt discounts related to warrants issued in conjunction with debt instruments being amortized over the life of the debt instrument; for the three months ended March 31, 2023, non-cash interest expense totaled $33,000.

Other Income and Expense

The amount of grant income increased $26,000 in the three months ended March 31, 2023, to $31,000.  Primarily through our wholly owned Canadian subsidiary, we have been awarded more than 80 research grants over the years from various public and private agencies, including the Canadian National Research Institute – Industrial Research Assistance Program (NRC-IRAP), the National Science and Engineering Research Council of Canada (NSERC), and the Metropolitan Water District of Southern California’s Innovative Conservation Program “ICP”. The research grants received are considered reimbursement grants related to costs we incur and therefore are included as Other Income. Grant funds paid directly to third parties are not included as income in our financial statements.

During the three months ended March 31, 2022, we recorded $174,000 in income related to the forgiveness of Paycheck Protection Act loan to ONM Environmental.

Net Loss

Net loss for the three months ended March 31, 2023, was $494,000 a loss of $0.0015 per share, compared to a net loss for the three months ended March 31, 2022, of $1,544,000, a loss of $0.0059 per share, a reduction of 68% . Our net loss this period declined because of the 288% increase in revenues, combined with a reduction in expenses, primarily sales, general and administrative costs.  

The net income (loss) per business segment is as follows (in thousands):

Net income (loss)	March 31, 2023			March 31, 2022
ONM Environmental	$	1,385		$	187
BLEST		(368	)		(35	)
Clyra Medical		(436	)		(247	)
BioLargo Water		(153	)		(233	)
BETI		(87	)		--
BioLargo corporate		(835	)		(1,266	)
Consolidated net loss	$	(494	)	$	(1,544	)

33

Liquidity and Capital Resources

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of our business. For the three months ended March 31, 2023, we generated revenues of $3,742,000 through our subsidiaries (see Note 11), had a net loss of $494,000, used $43,000 cash in operations, and at March 31, 2023, we had working capital of $3,075,000, and current assets of $4,874,000. While our operating loss has decreased in recent quarterly periods, as has our cash used in operations, we expect to continue to need further investment capital to fund operations. We have been, and anticipate that we will continue to be, limited in terms of our capital resources.

During the three months ended March 31, 2023, we (i) sold $105,000 of our common stock to Lincoln Park Capital Fund, LLC (“Lincoln Park”) (see Note 3), (ii) sold $695,000 of our common stock and warrants to accredited investors (see Notes 3 and 6), (iii) sold $225,000 of Clyra Medical Series A Preferred Stock (see Note 8), and (iv) sold $550,000 of BETI common stock (see Note 10).

As of March 31, 2023, our cash and cash equivalents totaled $3,264,000. Our total liabilities included a $78,000 a vehicle loan, $140,000 due in SBA loans issued pursuant to the Paycheck Protection Program (see Note 14), $150,000 due to the SBA issued pursuant to the Economic Injury Disaster program (EIDL) over 30 years, and $247,000 owed by a subsidiary due in 2024 (see Note 4).

Subsequent to March 31, 2023, we continue to sell common stock to Lincoln Park for working capital as needed (see Note 13).

If we are unable to rely on our current arrangement with Lincoln Park to fund our working capital requirements, we will have to rely on other forms of financing, and there is no assurance that we will be able to do so, or if we do so, it will be on favorable terms.

The foregoing factors raise substantial doubt about our ability to continue as a going concern, unless we are able to continue to raise funds through stock sales to Lincoln Park or other private financings, and in the long term, our ability to attain a reasonable threshold of operating efficiencies and achieve profitable operations by licensing or otherwise commercializing products incorporating our technologies. The consolidated financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.

Critical Accounting Policies

Our discussion and analysis of our results of operations and liquidity and capital resources are based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates and judgments, including those related to revenue recognition, valuation of offerings of debt with equity or derivative features which include the valuation of the warrant component, any beneficial conversion feature and potential derivative treatment, and share-based payments. We base our estimates on anticipated results and trends and on various other assumptions that we believe are reasonable under the circumstances, including assumptions as to future events. These estimates form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. By their nature, estimates are subject to an inherent degree of uncertainty. Actual results that differ from our estimates could have a significant adverse effect on our operating results and financial position.

34

Our significant accounting policies and methods used in the preparation of the Company’s consolidated financial statements are described in (i) in Part I, Item 1 of this Form 10-Q, Note 2, “Summary of Significant Accounting Policies” and (ii) in the Form 10-K for the year ended December 31, 2022, filed with the SEC on March 31, 2023, in the Notes to Consolidated Financial Statements in Part II, Item 8, and “Critical Accounting Policies and Estimates” in Part II, Item 7. There have been no material changes to the Company’s critical accounting policies and estimates since the filing of its Form 10-K.

Item 4.         Controls and Procedures

We conducted an evaluation, under the supervision and with the participation of management, including our chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended – the “Exchange Act”) as of the end of the period covered by this Report. There were no changes in our internal control over financial reporting during the quarter ended March 31, 2023, which were identified in connection with management’s evaluation required by paragraph (d) of Rules 13a-15 and 15d-15 under the Exchange Act, that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.

Our procedures have been designed to ensure that the information relating to our company, including our consolidated subsidiaries, required to be disclosed in our SEC reports is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate to allow for timely decisions regarding required disclosure. However, our Company is continuing to grow and evolve, as our product and services sales continues to grow, and as we diversify our clients to include municipalities, increasing strain on our accounting systems. These activities put stress on our overall controls and procedures. As our operations do not yet generate enough cash to fund operations, and we rely on financing activities to maintain our level of operations and fund our anticipated growth, we do not yet have the ability to implement the more sophisticated control systems used by larger companies. Although we have made some improvements, our chief executive officer and chief financial officer have concluded that, as of the evaluation date, our disclosure controls and procedures were not effective, due to the material weakness identified below.

It should be noted that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f). Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures are being made only in accordance with authorizations of management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the financial statements. 

Under the supervision and with the participation of our management, including our chief executive officer and the chief financial officer, we have established internal control procedures in accordance with the guidelines established in the 2013 Framework —Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Management evaluated the effectiveness of our internal controls, and concluded that due to our limited financial and personnel resources, the fact that we operate our business in three distinct locations in the U.S. and Canada, and the lack of sophisticated reporting systems, we continue to have a material weakness in our internal controls with respect to the closing our financial statements. Until the Company has the financial resources to implement more robust automated systems, or to hire additional dedicated accounting personnel, we expect this material weakness to continue.

Our management, including our chief executive officer and chief financial officer, does not expect that our disclosure controls or our internal control over financial reporting, or any system we design or implement in the future, will prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

35

PART II

OTHER INFORMATION

Item 1A.        Risk Factor

Our future results of operations, financial condition and liquidity and the market price for our securities are subject to numerous risks, many of which are driven by factors that we cannot control. The risk factors set forth in our report on Form 10-K for the period ended December 31, 2022, filed with the SEC on March 31, 2023, and below, discuss risks, uncertainties and assumptions relevant to our business and include factors we believe could cause our actual results to differ materially from expected and historical results. Other factors beyond those listed below, including factors unknown to us and factors known to us which we have not currently determined to be material, could also adversely affect our business, results of operations, financial condition, prospects and cash flows. Also see “Forward-looking Statements” above.

A significant portion of our revenue is concentrated with a one customer.

In the year ended December 31, 2022, almost 50% of our total revenue was from the sale of Pooph branded pet-odor products to Ikigai. In the three months ended March 31, 2023, sales to Ikigai accounted for 86% of our total revenue. Our contract with Ikigai does not require they purchase a minimum amount of product from us, and their demand for our product is dependent entirely on their customers’ demand. They create customer demand through television and other advertising, and sell directly to consumers as well as to retailers. Any decrease in their advertising is likely to correspondingly decrease their purchase of product from us. We have no control over their advertising budget or methods, and therefore have no control over their need for product from us. Other factors beyond our control may affect customer demand for the Pooph product. Any such decrease in demand for Pooph product would have a material adverse effect on our business, results of operations, or financial condition.

Item 2.          Unregistered Sales of Equity Securities and Use of Proceeds

The following is a report of sales of unregistered securities during the period covered by this report not previously reported in an annual report on Form 10-K, a Quarterly Report on Form 10-Q, or a Current Report on Form 8-K.

Unit Offering

During the three months ended March 31, 2023, we sold 2,340,211 shares of our common stock and received $470,000 in gross and net proceeds from eleven accredited investors. In addition to the shares, we issued the investors six-month warrants to purchase an aggregate 2,340,211 additional shares at $0.228 per share, and five-year warrants to purchase an aggregate 2,340,211 additional shares at $0.285 per share.

Clyra Medical

During the three months ended March 31, 2023, Clyra sold 725 shares of its Series A Preferred Stock, and in exchange received $225,000 in gross and net proceeds. Purchasers of the Series A Preferred Stock also received a 3-year warrant to purchase the same number of additional shares of common stock for $372 per share. Shares of Series A Preferred Stock earn a dividend of 15% each year. Each share of Series A Preferred stock can be converted by the holder at any time for one share of common stock. Accrued dividends may be converted to common stock at a conversion rate of $310 per share.

Each investor also entered into an agreement with BioLargo whereby the investor may exchange some or all of its Series A Preferred stock, plus accrued dividends, into shares of BioLargo common stock, at a price equal to a 20% discount of the volume weighted average price over the 30 prior trading days. Elections must be made during the 18-month period that begins 18 months after the closing of the Series A Preferred offering (which has not yet taken place), or June 30, 2023, whichever is earlier.

BETI

During the three months ended March 31, 2023, BETI sold 350,000 shares of its common stock to seven accredited investors for $2.00 per share. Of that amount, BioLargo purchased 50,000 shares for $100,000, and one investor converted a $50,000 note owed by BioLargo into 25,000 shares. Net proceeds from third parties totaled $550,000.

Each investor also entered into an agreement with BioLargo whereby the investor may exchange some or all of its shares of BETI common stock into shares of BioLargo common stock, at a price equal to a 20% discount of the volume weighted average price over the 20 trading days prior to the election to exchange. Elections must be made during calendar year 2024.

As of March 31, 2023, BioLargo holds 9,050,000 shares of BETI common stock, and third parties hold 300,000 shares.

All of these offerings and sales were made in reliance on the exemption from registration contained in Section 4(2) of the Securities Exchange Act and/or Regulation D promulgated thereunder as not involving a public offering of securities.

36

Item 5.          Other Information

Lincoln Park

On December 13, 2022, we entered into a purchase agreement (the “Purchase Agreement”) and a registration rights agreement (the “Registration Rights Agreement”), with Lincoln Park Capital Fund, LLC (“Lincoln Park”), pursuant to which Lincoln Park has committed to purchase up to $10.0 million of the Company’s common stock, par value $0.00067 per share (the “Common Stock”), subject to certain limitations and the satisfaction of the conditions set forth in the Purchase Agreement. (See Item 9B titled “Other Information”, and the subheading “Lincoln Park”, for additional information.)

During the three months ended March 31, 2023, we sold 545,142 shares of our common stock to Lincoln Park, and received $105,000 in gross and net proceeds.

Item 6.         Exhibits

See the Exhibit Index for a list of exhibits filed as part of this report and incorporated herein by reference.

Exhibit Index

		Incorporated by Reference Herein
Exhibit Number	Exhibit Description	Form	File Date
3.1	Bylaws of BioLargo, Inc., as amended and restated	Form 10-KSB	5/23/2003
3.2	Amended and Restated Certificate of Incorporation for BioLargo, Inc. filed March 16, 2007	Form 10-KSB	5/4/2007
3.3	Certificate of Amendment to Certificate of Incorporation, filed May 25, 2018	Pos Am	6/22/2018
3.4	Certificate of Amendment to Certificate of Incorporation, filed August 30, 2022	Form 10-Q	11/14/2022
3.5	Amended and Restated Articles of Incorporation of Clyra Medical Technologies, Inc. (filed December 30, 2022)	Form 10-K	3/31/2023
4.1	BioLargo, Inc. 2007 Equity Incentive Plan	Form 10-QSB	11/19/2007
4.2	Amendment No. 1 to BioLargo 2007 Equity Incentive Plan	Def 14C (Exhibit A)	5/2/2011
4.3	Form of Stock Options issued in exchange for reduction in accounts payable.	Form 10-K	3/31/2015
4.4	$50,000 convertible note, matures March 8, 2020	Form 10-Q	5/14/2018
4.5	2018 Equity Incentive Plan	Form S-8	6/22/2018
4.6	Stock Option Award Agreement under 2018 Equity Incentive Plan	Form S-8	6/22/2018
4.7	Notice of Stock Option Grant under 2018 Equity Incentive Plan	Form S-8	6/22/2018
4.8	Restricted Stock Unit Award Agreement under 2018 Equity Incentive Plan	Form S-8	6/22/2018
4.9	Notice of Restricted Stock Unit Award under 2018 Equity Incentive Plan	Form S-8	6/22/2018

37

4.10	Revolving Line of Credit Agreement dated June 30, 2020, between Clyra Medical and Vernal Bay	Form 8-K	7/7/2020
4.11	Security Agreement dated June 30, 2020, between Clyra Medical and Vernal Bay	Form 8-K	7/7/2020
4.12	Revolving Line of Credit Note issued by Clyra Medical to Vernal Bay on June 30, 2020	Form 8-K	7/7/2020
4.13	Warrant issued in 2020 Unit Offering	Form 10-Q	8/14/2020
4.14	Amendment to $50,000 Convertible Note dated March 8, 2018	Form 10-K	3/30/2021
4.15	Warrant issued to $50,000 Convertible Noteholder on March 1, 2020	Form 10-K	3/30/2021
4.16	Satisfaction of Convertible Note dated March 8, 2018	Form 10-K	3/31/2023
10.1	Form of indemnity agreement between the Company at its officers and directors	Form 10-K	3/31/2023
10.2	License Agreement to Clyra Medical Technologies, Inc., dated December 17, 2012	Form 8-K	1/6/2016
10.3	December 30, 2015 amendment to License Agreement with Clyra Medical Technologies, Inc.	Form 8-K	1/6/2016
10.4	Consulting Agreement dated December 30, 2015 with Beach House Consulting LLC	Form 8-K	1/6/2016
10.5	Commercial Office Lease Agreement for 14921 Chestnut St., Westminster, CA 92683	Form 8-K	8/24/2016
10.6†	Employment Agreement with Dennis P. Calvert dated May 2, 2017.	Form 8-K	5/4/2017
10.7†	Lock-Up Agreement with Dennis P. Calvert dated April 30, 2017	Form 8-K	5/4/2017
10.8	Commercial Office Lease Agreement for Oak Ridge Tennessee	Form 8-K	9/8/2017
10.9	Form of Employment Agreement for Engineering Subsidiary	Form 8-K	9/8/2017
10.10	Form of Option issued to founding employees of Engineering subsidiary (BLEST)	Form 8-K	9/8/2017
10.11†	Employment Agreement with Joseph L. Provenzano dated May 28, 2019	Form 8-K	6/24/2019
10.12†	Lock-Up Agreement dated May 28, 2019	Form 8-K	6/24/2019
10.13	Purchase Agreement, dated as of March 30, 2020 by and between BioLargo, Inc. and Lincoln Park Capital Fund, LLC.	Form 8-K	3/31/2020
10.14	Amendment dated June 30, 2020 to License Agreement with Clyra Medical Technologies, Inc.	Form 8-K	7/7/2020
10.15	Amendment dated June 30, 2020 to Consulting Agreement dated December 30, 2015 between Clyra Medical and Beach House Consulting LLC	Form 8-K	7/7/2020
10.16†	2022 Engagement Extension Agreement with CFO	Form 8-K	3/24/2022
10.17	Purchase Agreement, dated as of December 13, 2022, by and between BioLargo, Inc. and Lincoln Park Capital Fund, LLC.	Form 8-K	12/19/2022
10.18	Registration Rights Agreement, dated as of December 13, 2022, by and between BioLargo, Inc. and Lincoln Park Capital Fund, LLC	Form 8-K	12/19/2022
10.19†	2023 Engagement Extension Agreement with CFO	Form 8-K	3/27/2023
10.20*	Form of Share Exchange Agreement between BioLargo, Inc., and purchasers of Clyra Medical Series A Preferred Stock		filed herewith

38

10.21*	Form of Share Exchange Agreement between BioLargo, Inc., and purchasers of BioLargo Energy Technologies, Inc. common stock	filed herewith
21.1*	List of Subsidiaries of the Registrant	filed herewith
31.1*	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and Rules 13(a)-14 and 15(d)-14 under the Securities Exchange Act of 1934	filed herewith
31.2*	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and Rules 13(a)-14 and 15(d)-14 under the Securities Exchange Act of 1934	filed herewith
32*	Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350	filed herewith
101.INS**	Inline XBRL Instance
101.SCH**	Inline XBRL Taxonomy Extension Schema
101.CAL**	Inline XBRL Taxonomy Extension Calculation
101.DEF**	Inline XBRL Taxonomy Extension Definition
101.LAB**	Inline XBRL Taxonomy Extension Labels
101.PRE**	Inline XBRL Taxonomy Extension Presentation
104	Cover Page Interactive Data File (embedded within the Inline XBRL and contained in Exhibit 101)

* Filed herewith

** Furnished herewith

† Management contract or compensatory plan, contract or arrangement

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	BIOLARGO, INC.
Date: May 17, 2023	By:	/s/ DENNIS P. CALVERT
		Dennis P. Calvert
		Chief Executive Officer
Date: May 17, 2023	By:	/s/ CHARLES K. DARGAN, II
		Chief Financial Officer

39

EX-10.20

Ex. 10.20

SHARE EXCHANGE AGREEMENT

THIS SHARE EXCHANGE AGREEMENT (“Agreement”) is made and entered into as of _______________________________, by and between Clyra Medical Technologies, Inc., a California corporation (“Clyra”), BioLargo, Inc., a Delaware corporation (“BioLargo”), and _________________________________________________ (“Investor”), with respect to the following:

R E C I T A L S :

A.    Clyra accepted an investment from Investor in its October 2022 Preferred Unit Offering, whereby Investor acquired Units at a price of $310 per Unit, each Unit consisting of Series A Preferred Stock and a stock purchase warrant, as more particularly described on Schedule A.

B.    BioLargo is the founding shareholder of Clyra, and its common stock is traded on the OTCQB Venture Market under the symbol BLGO.

C.    Clyra, BioLargo and Investor enter into this Agreement to allow Investor to exchange its Series A Preferred Shares for BioLargo common stock in accordance with the terms and conditions herein.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:

1.    Election to Make Exchange.

(a)    During the period beginning eighteen (18) months after the Offering Closing Date, and ending on the third anniversary of the Offering Closing Date (such period referred to herein as the “Election Period”), Investor may elect to exchange one, some or all of its Series A Preferred Shares for BioLargo common shares as described in Section 2 and in accordance with the terms and conditions herein. Investor may make such election one or more times. Each notice of election (each, an “Election Notice”) must be made in writing in the form of Exhibit A attached hereto, designate the number of Series A Preferred Shares to be exchanged (the “Tendered Shares”), and shall be delivered to BioLargo pursuant to the notice provisions set forth in Section 10 below. The date of delivery of an Election Notice to BioLargo shall be considered the “Election Date”. The term “Offering Closing Date” means the date established by Clyra for the closing of its October 2022 $1,000,000 Preferred Unit Offering, but no later than June 30, 2023. Clyra shall notify Investor of the Offering Closing Date within thirty (30) days thereof.

-1-

(b)    Within ten (10) days of receipt of an Election Notice, BioLargo shall return a copy of the Election Notice to Investor setting forth the number of Tendered Shares, the amount of accrued dividend related to the Tendered Shares, the conversion price (as determined pursuant to Section 2(b) below), and the number of shares to be issued in exchange for the Tendered Shares.

(c)    The Investor may convert a number of Series A Preferred Shares up to a maximum current value equal to the Investor’s aggregate original investment. In the event Clyra’s most recent sale of common or preferred stock is more than $310 per share, BioLargo shall determine the maximum number of shares the Investor may tender, as follows: the Investor’s investment amount divided by the current Clyra share price. For example, if the Investor had originally invested $100,000, and Clyra subsequently sold shares for $500 per share, the investor may tender a maximum of 200 Series A Preferred Shares. The accrued dividend converted to BioLargo shares would be based on 200 shares, not 322 shares.

2.    Exchange of Shares.

(a)    Exchange. On the terms and subject to the conditions set forth in this Agreement, at the Closing (i) Investor will sell, convey, transfer and assign to BioLargo, free and clear of all liens, pledges, encumbrances, changes, restrictions or known claims of any kind, nature or description, and BioLargo will purchase and accept from Investor the Tendered Shares, as adjusted, and (ii) in exchange for the transfer of such securities by Investor, BioLargo will sell, convey, transfer and assign to Investor, and Investor will purchase and accept from BioLargo, newly-issued shares of common stock of BioLargo, par value $0.00067 (such exchange referred to herein as the “Exchange”), in an amount as determined in accordance with subsection (b) below.

(b)    Issuance. BioLargo shall issue to the number of shares of its common stock (the “BioLargo Shares”) equal to the sum of (i) the current value of the Tendered Shares and (ii) the accrued dividend related to the Tendered Shares, divided by a “conversion price” to be determined as of the Election Date, rounded to the nearest whole share. For the purposes of the foregoing, “Conversion Price” shall equal a twenty percent (20%) discount to the volume weighted average price of BioLargo common stock on the OTCQB for the thirty (30) trading days preceding the Election Date. The volume weighted average price shall be determined in accordance with the data provided by OTC Markets Group Inc. (or other exchange if BLGO is then-traded on another exchange). For example, if the current value of the Tendered Shares is $100,000, the accrued dividend related to the Tendered Shares is $20,000, and the conversion price is $0.50, BioLargo shall issue 240,000 shares.

(c)    Closing. The closing of the Exchange shall occur on a date within 30 days of the Election Date, as determined by BioLargo (the “Closing”). The Closing will take place at 10:00 a.m. Pacific Time at the offices of BioLargo, 14921 Chestnut Street, Westminster, California 92683, or at such other date, time and place or manner as may be agreed upon by the parties.

-2-

3.    Restrictions on Sale of BioLargo Shares.

(a)    During the period beginning on the date of Closing and ending on the date that Investor is no longer the record or beneficial owner of any of the BioLargo Shares, during any on trading day, Investor shall not sell more BioLargo Shares than the number equal to five percent (5%) of the average of the daily volume of Biolargo common stock traded on the OTCQB (or exchange, if applicable) of the five trading days preceding the date of sale, without the prior written consent of the Company, which may be given or withheld in the Company’s sole discretion.

(b)    Beneficial Ownership. If the Investor shall or would receive shares of BioLargo common stock in accordance with an Election Notice so that the Investor would, together with other shares of BioLargo common stock held by it or its affiliates, own or beneficially own by virtue of such action or receipt of additional shares of BioLargo common stock a number of shares exceeding 4.99% of the number of shares of BioLargo common stock outstanding on such date (the “Maximum Percentage”), BioLargo shall not be obligated and shall not issue to the Investor shares of BioLargo common stock which would exceed the Maximum Percentage, but only until such time as the Maximum Percentage would no longer be exceeded by any such receipt of shares of BioLargo common stock by the Investor. Upon delivery of a written notice to the Company, the Buyer may from time to time increase (with such increase not effective until the sixty-first (61st) day after delivery of such notice) or decrease the Maximum Percentage to any other percentage not in excess of 9.99% as specified in such notice; provided that (i) any such increase in the Maximum Percentage will not be effective until the sixty-first (61st) day after such notice is delivered to the Company and (ii) any such increase or decrease will apply only to the Investor and its Affiliates. The limitation contained in this paragraph may not be waived.

4.    Representations and Warranties.

(a)    Representations and Warranties of Investor. Investor hereby represents and warrants to Clyra and Biolargo, all of which representations and warranties are true, complete, and correct in all respects as of the date hereof and will be as of the Closing, as follows:

(A)    Authorization; No Restrictions, Consents or Approvals. Investor has the right, power, legal capacity and authority to enter into and perform Investor’s obligations under this Agreement; and no approvals or consents are necessary in connection with it. All of the Series A Preferred Stock owned by Investor are owned free and clear of all liens, pledges, encumbrances, changes, restrictions or known claims of any kind, nature or description.

(B)    Transfer of Tendered Shares. The Series A Preferred Stock tendered for transfer will, at the Closing, be validly transferred to BioLargo free and clear of any encumbrances and from all taxes, liens and charges with respect to the transfer thereof and such shares of Series A Preferred Stock of Clyra shall be fully paid and non-assessable with the holder being entitled to all rights accorded to a holder of shares of Series A Preferred Stock.

-3-

(C)    Investment Representations.

(1)    Investor understands that the BioLargo Shares have not been registered under the Securities Act of 1933, as amended (the “Securities Act”) or any other applicable securities laws, including those under the California Corporations Code. Investor also understands that the BioLargo Shares are being offered and issued pursuant to an exemption from the registration requirements of the Securities Act, under Section 4(2) and/or Regulation D of the Securities Act, and of the California Corporations Code, under Section 25012(f). Investor acknowledges that BioLargo will rely on Investor’s representations, warranties and certifications set forth below for purposes of determining Investor’s suitability as an investor in the BioLargo Shares and for purposes of confirming the availability of the Section 4(2) and/or Regulation D exemption from the registration requirements of the Securities Act, and of the Section 25012(f) exemption under the California Corporations Code.

(2)    Investor has received all the information it considers necessary or appropriate for deciding whether to acquire the BioLargo Shares, including the information filed by BioLargo with the Securities and Exchange Commission, available on the Internet at www.sec.gov. Investor understands the risks involved in an investment in the BioLargo Shares. Investor further represents that Investor has had an opportunity to ask questions and receive answers from BioLargo regarding the terms and conditions of the offering of the BioLargo Shares and the business, properties, prospects, and financial condition of BioLargo and Clyra and to obtain such additional information (to the extent BioLargo or Clyra possessed such information or could acquire it without unreasonable effort or expense) necessary to verify the accuracy of any information furnished to Investor or to which Investor had access. Investor further represents that Investor is an “accredited investor” within the meaning of Rule 501(a) of the Securities Act.

(3)    Investor is acquiring the BioLargo Shares for Investor’s own account for investment only and not with a view towards their resale or “distribution” (within the meaning of the Securities Act) of any part of the BioLargo Shares.

(4)    Investor understands that the BioLargo Shares may not be offered, sold or otherwise transferred except in compliance with the registration requirements of the Securities Act and any other applicable securities laws or pursuant to an exemption therefrom, and in each case in compliance with the conditions set forth in this Agreement. Investor acknowledges and is aware that the BioLargo Shares may not be sold pursuant to Rule 144 adopted under the Securities Act unless certain conditions are met and until Investor has held the security for the applicable holding period under Rule 144.

-4-

(5)    Investor acknowledges and agrees that each certificate (or book-entry advice) representing the BioLargo Shares shall bear a legend substantially in the following form:

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE. THE SECURITIES MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH LAWS.”

(D)    No Reliance. Investor has not relied on and is not relying on any representations, warranties or other assurances regarding BioLargo or Clyra other than the representations and warranties expressly set forth in this Agreement.

(b)    Representations and Warranties of Clyra. Clyra hereby represents and warrants to Investor and BioLargo, all of which representations and warranties are true, complete, and correct in all respects as of the date hereof and will be as of the Closing, as follows:

(A)    Organization and Qualification. Clyra is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation.

(B)    Authorization; No Restrictions, Consents or Approvals. Clyra has full power and authority to enter into and perform its obligations under this Agreement. This Agreement has been duly executed by Clyra and constitutes the legal, valid, binding and enforceable obligation of Clyra, enforceable against Clyra in accordance with its terms. The execution and delivery of this Agreement and the consummation by Clyra of the transactions contemplated herein do not and will not on the Closing (A) conflict with or violate any of the terms of the articles of incorporation and bylaws of Clyra or any applicable law relating to Clyra, (B) conflict with, or result in a breach of any of the terms of, or result in the acceleration of any indebtedness or obligations under, any material agreement, obligation or instrument by which Clyra is bound or to which any property of Clyra is subject, or constitute a default thereunder, other than those material agreements, obligations or instruments for which Clyra has obtained consent for the transactions contemplated under this Agreement, (C) result in the creation or imposition of any lien on any of the assets of Clyra, (D) constitute an event permitting termination of any material agreement or instrument to which Clyra is a party or by which any property or asset of Clyra is bound or affected, pursuant to the terms of such agreement or instrument, other than those material agreements or instruments for which Clyra has obtained consent for the transactions contemplated under this Agreement, or (E) conflict with, or result in or constitute a default under or breach or violation of or grounds for termination of, any license, permit or other governmental authorization to which Clyra is a party or by which Clyra may be bound, or result in the violation by Clyra of any laws to which Clyra may be subject, which would materially adversely affect the transactions contemplated herein. No authorization, consent or approval of, notice to, or filing with, any public body or governmental authority or any other person is necessary or required in connection with the execution and delivery by Clyra of this Agreement or the performance by Clyra of its obligations hereunder.

-5-

(c)    Representations and Warranties of BioLargo. BioLargo hereby represents and warrants to Investor and Clyra, all of which representations and warranties are true, complete, and correct in all respects as of the date hereof and will be as of the Closing, as follows:

(A)    Organization and Qualification. BioLargo is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation.

(B)    Authorization; No Restrictions, Consents or Approvals. BioLargo has full power and authority to enter into and perform its obligations under this Agreement. This Agreement has been duly executed by BioLargo and constitutes the legal, valid, binding and enforceable obligation of BioLargo, enforceable against BioLargo in accordance with its terms. The execution and delivery of this Agreement and the consummation by BioLargo of the transactions contemplated herein (including the issuance of the BioLargo Shares in exchange for the Tendered Shares) do not and will not on the Closing (A) conflict with or violate any of the terms of the articles of incorporation and bylaws of BioLargo or any applicable law relating to BioLargo, (B) conflict with, or result in a breach of any of the terms of, or result in the acceleration of any indebtedness or obligations under, any material agreement, obligation or instrument by which BioLargo is bound or to which any property of BioLargo is subject, or constitute a default thereunder, other than those material agreements, obligations or instruments for which BioLargo has obtained consent for the transactions contemplated under this Agreement, (C) result in the creation or imposition of any lien on any of the assets of BioLargo, (D) constitute an event permitting termination of any material agreement or instrument to which BioLargo is a party or by which any property or asset of BioLargo is bound or affected, pursuant to the terms of such agreement or instrument, other than those material agreements or instruments for which BioLargo has obtained consent for the transactions contemplated under this Agreement, or (E) conflict with, or result in or constitute a default under or breach or violation of or grounds for termination of, any license, permit or other governmental authorization to which BioLargo is a party or by which BioLargo may be bound, or result in the violation by BioLargo of any laws to which BioLargo may be subject, which would materially adversely affect the transactions contemplated herein. No authorization, consent or approval of, notice to, or filing with, any public body or governmental authority or any other person is necessary or required in connection with the execution and delivery by BioLargo of this Agreement or the performance by BioLargo of its obligations hereunder.

-6-

(C)    Issuance of Shares. The BioLargo Shares have been duly authorized and, upon issuance in accordance with the terms hereof, shall be validly issued and free from all taxes, liens and charges with respect to the issue thereof, and the BioLargo Shares shall be fully paid and non-assessable with the holder being entitled to all rights accorded to a holder of BioLargo Class B common stock.

(D)    Investment Representations

(1)    BioLargo understands that the Tendered Shares have not been registered under the Securities Act of 1933, as amended (the “Securities Act”) or any other applicable securities laws, including those under the California Corporations Code. BioLargo also understands that the Tendered Shares are being offered pursuant to an exemption from the registration requirements of the Securities Act, under Section 4(2) and/or Regulation D of the Securities Act, and of the California Corporations Code, under Section 25012(f). BioLargo acknowledges that Investor will rely on BioLargo representations, warranties and certifications set forth below for purposes of determining BioLargo suitability as an investor in the Tendered Shares and for purposes of confirming the availability of the Section 4(2) and/or Regulation D exemption from the registration requirements of the Securities Act, and of the Section 25012(f) exemption under the California Corporations Code.

(2)    No Reliance. BioLargo has not relied on and is not relying on any representations, warranties or other assurances regarding Clyra other than the representations and warranties expressly set forth in this Agreement.

5.    Closing.

(a)    Conditions to Investor’s Obligations. The obligations of Investor under this Agreement, (including, without limitation, the obligation to transfer the Tendered Shares in exchange for the BioLargo Shares) shall be subject to satisfaction of the following conditions, unless waived by Investor: (i) Clyra and BioLargo shall have performed in all material respects all agreements, and satisfied in all material respects all conditions on its part to be performed or satisfied hereunder, at or prior to the Closing; (ii) all of the representations and warranties of Clyra and BioLargo herein shall have been true and correct in all respects when made, shall have continued to have been true and correct in all respects at all times subsequent thereto, and shall be true and correct in all material respects on and as of the Closing as though made on, as of, and with reference to such Closing; (iii)  BioLargo shall have executed and be prepared to deliver to its transfer agent all documents necessary to issue the BioLargo Shares to Investor, as contemplated by this Agreement; and (iv) Clyra and BioLargo shall have obtained or made, as applicable, all consents, authorizations and approvals from, and all declarations, filings and registrations required to consummate the transactions contemplated by this Agreement, including all items required under the incorporation document and bylaws of Clyra and BioLargo, respectively.

-7-

(b)    Conditions to BioLargo’ Obligations. The obligations of BioLargo under this Agreement, (including, without limitation, the obligation to issue the BioLargo Shares in exchange for the transfer by Investor of the Tendered Shares) shall be subject to satisfaction of the following conditions, unless waived by BioLargo: (i) Investor shall have performed in all respects all agreements, and satisfied in all respects all conditions on their part to be performed or satisfied hereunder, at or prior to the Closing; (ii) all of the representations and warranties of Investor herein shall have been true and correct in all material respects when made, shall have continued to have been true and correct in all material respects at all times subsequent thereto, and shall be true and correct in all material respects on and as of the Closing as though made on, as of, and with reference to such Closing; and (iii) Investor shall have executed and delivered to BioLargo all documents necessary to transfer the Tendered Shares to BioLargo, as contemplated by this Agreement (including those documents described in Section 4(c)).

(c)    Closing Documents. At the Closing,

(A)    Investor shall deliver to BioLargo, in form and substance reasonably satisfactory to BioLargo, (i) a fully executed and notarized Stock Power transferring the Tendered Shares, in the form attached hereto as Exhibit B, and (ii) a filled out and signed IRS Form W-9;

(B)    BioLargo shall deliver to Investor a Direct Registration Book-Entry Advice (delivered by its transfer agent in normal course following the Closing), representing the issuance of the BioLargo Shares, registered in the name of Investor.

(C)    Clyra shall deliver to BioLargo evidence that the Tendered Shares have been transferred and assigned to BioLargo on the books and records of Clyra.

6.    Survival of Representations and Warranties. None of the representations, warranties and covenants of Investor, Clyra or BioLargo hereto contained in this Agreement shall survive the Closing, except that the representations and warranties contained in Section 3(a)(i), Section 3(b)(i), Section 3(b)(ii), Section 3(b)(iii), Section 3(c)(i), and Section 3(c)(ii) shall survive until the latest date permitted by applicable law. Except as specifically set forth in the preceding sentence, no other representation, warranty or covenant of any party set forth in this Agreement will survive the Closing, and no party will have any rights or remedies after the Closing with respect to any misrepresentation of or inaccuracy in any such representation, warranty or covenant

-8-

7.    Releases and Waivers of Investor.  Investor hereby generally, irrevocably, unconditionally and completely waives any and all rights to receive any anti-dilution protection to which Investor may be entitled under the articles of incorporation, bylaws or other organizational documents of Clyra or BioLargo or under any other agreement or instrument in connection with the Exchange. Except for the BioLargo Shares to be issued in connection with the Exchange, Investor hereby generally, irrevocably, unconditionally and completely waives any and all rights existing as of the date hereof to receive options, depository receipts, warrants, stock appreciation or similar rights to acquire or receive securities in Clyra or BioLargo.

8.    Notices. All notices or other communications required or permitted hereunder (a “Notice”) shall be in writing, and shall be (a) personally delivered, sent by national overnight courier service, or sent by registered or certified mail, first class postage prepaid, return receipt requested, or (b) sent by electronic mail, but only if either (i) at least one recipient of the Notice (or legal counsel if identified below), acknowledges receipt of such transmission by email or (ii) a confirming copy of the Notice is sent by first class mail or one of the methods set forth in clause (a), above, not later than the first business day following transmission. Personally and courier delivered notices shall be deemed given upon actual personal delivery to designated address of the intended recipient. Mailed notices shall be deemed given upon the date of actual receipt as evidenced by the return receipt. Electronically mailed notices shall be deemed given upon the date the email is transmitted if transmitted without indication of delivery failure prior to 5:00 p.m. local time for the sender (and if transmitted without indication of delivery failure after 5:00 p.m. local time for the sender, then delivery will be deemed duly given at 9:00 a.m. local time for the sender on the subsequent business day). Any Notice shall be sent, transmitted or delivered, as applicable, to the applicable parties at the following addresses:

Clyra Medical Technologies, Inc.

14921 Chestnut St.

Westminster, CA 92683

Email: steveh@clyramedical.com

With copy to: John R. Browning

Browning Law Group, APC

18818 Teller Ave, Suite 115

Irvine, CA 92612

Email: john@browninglawgroup.com

BioLargo, Inc.

14921 Chestnut St.

Westminster, CA 92683

Email: dennis.calvert@biolargo.com

With copy to: John R. Browning

Browning Law Group, APC

18818 Teller Ave, Suite 115

Irvine, CA 92612

Email: john@browninglawgroup.com

Investor: at the address set forth on Investor’s subscription agreement, or, if different, the address set forth on the W-9 delivered by Investor to BioLargo and Clyra in accordance with Section 2.

-9-

9.    General Provisions.

(a)    Entire Agreement. This Agreement supersedes any and all other agreements, either oral or in writing, between the parties with respect to the subject matter hereof and contains all of the covenants and agreements between the parties with respect to the cancellation of the Clyra Shares, and transfer of the BioLargo Shares. Each party to this Agreement acknowledges that no representations, inducements, promises or agreements, orally or otherwise, have been made by any party, or anyone acting on behalf of any party, which are not embodied herein, and that no other agreement, statement or promise not contained in this Agreement shall be valid or binding on either party.

(b)    Attorneys’ Fees and Costs. In the event that any legal proceeding is brought to enforce or interpret any of the rights or obligations under this Agreement, the prevailing party shall be entitled to recover reasonable attorneys’ fees, costs and disbursements in addition to any other relief to which the prevailing party may be entitled.

(c)    Governing Law; Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of California. Venue for any legal or equitable action between the Company and Stockholder which relates to this Agreement shall be in the county of Orange.

(d)    Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original but all of which shall constitute one and the same instrument.

[SIGNATURE PAGE FOLLOWS]

-10-

IN WITNESS WHEREOF, the parties have executed this Share Exchange Agreement on the day and year first indicated above.

Clyra Medical Technologies, Inc.

By:                                                               

         Steven V. Harrison, President                  

BioLargo, Inc.

By:                                                                

Dennis P. Calvert, President                   

INVESTOR: ______________________________

By:                                                         

Name: ______________________

Title: _______________________

-11-

SCHEDULE A

INVESTMENT DETAILS

Investor name: _______________________

Units Purchased:
Purchase Amount:	$
Purchase Date:

EXHIBIT A

FORM OF ELECTION NOTICE

I, the undersigned Investor, hereby tender the following number of shares of Series A Preferred Stock purchased in Clyra Medical Technologies, Inc. October 2022 Preferred Unit Offering for exchange into BioLargo common stock:

Number of “Tendered Shares”: ______________________

Investor name: ______________________________________

Signature: ___________________________

Name, capacity of signatory: _________________________________

FOR BIOLARGO USE ONLY

Total Units originally purchased by Investor:
Original investment amount:	$
Investment date:
Date Election Notice received:
Current share price of Clyra stock:	$
Maximum number of tendered shares:
Tendered Shares (as adjusted for increased price):
Accrued Dividend (of Tendered Shares, as adjusted):	$
Conversion Price:	$
BioLargo Shares to issue in exchange:

CALCULATIONS:

Accrued Dividend shall be calculated in accordance with Clyra’s Amended and Restated Articles of Incorporation and based on the number of Tendered Shares, as adjusted.

Conversion Price is equal to a twenty percent (20%) discount to the average volume weighted average price of BLGO for the thirty (30) trading days preceding the Election Date. The volume weighted average price shall be determined in accordance with the data provided by OTC Markets Group, Inc. (or other exchange if BLGO is then-traded on another exchange).

The number of BioLargo Shares to be exchanged with (issued to) Investor shall be determined based on the following formula: the sum of the Tendered Shares Value and the Accrued Dividend, divided by the Conversion Price, rounded to the nearest whole share. Tendered Shares Value means the number of Tendered Shares, as adjusted, multiplied by the current Clyra share price.

EXHIBIT B

FORM OF IRREVOCABLE STOCK POWER

FOR VALUE RECEIVED, I, _______________, do hereby sell, assign and transfer unto BIOLARGO, INC., _______________ shares of Series A Preferred Stock of CLYRA MEDICAL TECHNOLOGIES, INC., a California corporation (the “Corporation”), standing in my name on the books of the Corporation, and do hereby irrevocably constitute and appoint John R. Browning of the Browning Law Group as attorney to transfer said shares on the books of said Corporation, with full power of substitution in the premises.

DATED: ______________

EX-10.21

Ex. 10.21

SHARE EXCHANGE AGREEMENT

THIS SHARE EXCHANGE AGREEMENT (“Agreement”) is made and entered into as of _______________________________, by and between BioLargo Energy Technologies, Inc., a California corporation (“BET”), BioLargo, Inc., a Delaware corporation (“BioLargo”), and _________________________________________________ (“Investor”), with respect to the following:

R E C I T A L S :

A.    BET accepted an investment from Investor in its private securities offering dated January 1, 2023 (the “Offering”), whereby Investor purchased shares of BET common stock (the “Shares”) at a price of $2.00 per share, as indicated on the signature page of this Agreement.

B.    BioLargo is the founding shareholder of BET, and its common stock is traded on the OTCQB Venture Market under the symbol BLGO.

C.    BET, BioLargo and Investor enter into this Agreement to allow Investor to exchange its shares purchased in the Offering for BioLargo common stock in accordance with the terms and conditions herein.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:

1.    Election to Make Exchange.

(a)    During the period beginning January 1, 2024, and ending December 31, 2024 (such period referred to herein as the “Election Period”), Investor may elect to exchange one, some or all of its Shares for BioLargo common shares in accordance with the terms and conditions herein. Investor may make such election only one time. The notice of election (“Election Notice”) must be made in writing in the form of Exhibit A attached hereto, designate the number of Shares to be exchanged (the “Tendered Shares”), and shall be delivered to BioLargo pursuant to the notice provisions set forth in Section 10 below. The date of delivery of the Election Notice to BioLargo shall be considered the “Election Date”.

(b)    Within ten (10) days of receipt of an Election Notice, BioLargo shall return a copy of the Election Notice to Investor setting forth the conversion price (as determined pursuant to Section 2(b) below), and the number of shares to be issued in exchange for the Tendered Shares.

-1-

2.    Exchange of Shares.

(a)    Exchange. On the terms and subject to the conditions set forth in this Agreement, at the Closing (i) Investor will sell, convey, transfer and assign to BioLargo, free and clear of all liens, pledges, encumbrances, changes, restrictions or known claims of any kind, nature or description, and BioLargo will purchase and accept from Investor the Tendered Shares, and (ii) in exchange for the transfer of such securities by Investor, BioLargo will sell, convey, transfer and assign to Investor, and Investor will purchase and accept from BioLargo, newly-issued shares of common stock of BioLargo, par value $0.00067 (such exchange referred to herein as the “Exchange”), in an amount as determined in accordance with subsection (b) below.

(b)    Issuance. BioLargo shall issue to the number of shares of its common stock (the “BioLargo Shares”) equal to the purchase price of the Tendered Shares (as may have been adjusted), divided by a “conversion price” to be determined as of the Election Date, rounded to the nearest whole share. For the purposes of the foregoing, “Conversion Price” shall equal a twenty percent (20%) discount to the volume weighted average price of BioLargo common stock on the OTCQB for the twenty (20) trading days preceding the Election Date. The volume weighted average price shall be determined in accordance with the data provided by OTC Markets Group Inc. (or other exchange if BLGO is then-traded on another exchange). For example, if the Investor tenders 50,000 shares purchased for $2.00 per share, and the conversion price is $0.50, BioLargo would issue 200,000 shares. If the investor had received additional shares due to a future sale less than $2.00 per share, the adjusted purchase price would be used in the foregoing formula. For example, if the adjusted price was $1.60, and the investor tendered his or her 62,500 shares, the investor would still receive 200,000 BioLargo shares (the 62,500 shares, times the $1.60 adjusted purchase price, divided by $0.50).

(c)    Closing. The closing of the Exchange shall occur on a date within 30 days of the Election Date, as determined by BioLargo (the “Closing”). The Closing will take place at 10:00 a.m. Pacific Time at the offices of BioLargo, 14921 Chestnut Street, Westminster, California 92683, or at such other date, time and place or manner as may be agreed upon by the parties.

3.    Restrictions on Sale of BioLargo Shares.

(a)    During the period beginning on the date of Closing and ending on the date that Investor is no longer the record or beneficial owner of any of the BioLargo Shares, during any on trading day, Investor shall not sell more BioLargo Shares than the number equal to five percent (5%) of the average of the daily volume of Biolargo common stock traded on the OTCQB (or exchange, if applicable) of the five trading days preceding the date of sale, without the prior written consent of the Company, which may be given or withheld in the Company’s sole discretion.

(b)    Beneficial Ownership. If the Investor shall or would receive shares of BioLargo common stock in accordance with an Election Notice so that the Investor would, together with other shares of BioLargo common stock held by it or its affiliates, own or beneficially own by virtue of such action or receipt of additional shares of BioLargo common stock a number of shares exceeding 4.99% of the number of shares of BioLargo common stock outstanding on such date (the “Maximum Percentage”), BioLargo shall not be obligated and shall not issue to the Investor shares of BioLargo common stock which would exceed the Maximum Percentage, but only until such time as the Maximum Percentage would no longer be exceeded by any such receipt of shares of BioLargo common stock by the Investor. Upon delivery of a written notice to the Company, the Buyer may from time to time increase (with such increase not effective until the sixty-first (61st) day after delivery of such notice) or decrease the Maximum Percentage to any other percentage not in excess of 9.99% as specified in such notice; provided that (i) any such increase in the Maximum Percentage will not be effective until the sixty-first (61st) day after such notice is delivered to the Company and (ii) any such increase or decrease will apply only to the Investor and its Affiliates. The limitation contained in this paragraph may not be waived.

-2-

4.    Representations and Warranties.

(a)    Representations and Warranties of Investor. Investor hereby represents and warrants to BET and Biolargo, all of which representations and warranties are true, complete, and correct in all respects as of the date hereof and will be as of the Closing, as follows:

(A)    Authorization; No Restrictions, Consents or Approvals. Investor has the right, power, legal capacity and authority to enter into and perform Investor’s obligations under this Agreement; and no approvals or consents are necessary in connection with it. All of the Shares owned by Investor are owned free and clear of all liens, pledges, encumbrances, changes, restrictions or known claims of any kind, nature or description.

(B)    Transfer of Tendered Shares. The Shares tendered for transfer will, at the Closing, be validly transferred to BioLargo free and clear of any encumbrances and from all taxes, liens and charges with respect to the transfer thereof and such shares of Shares of BET shall be fully paid and non-assessable with the holder being entitled to all rights accorded to a holder of shares of Shares.

(C)    Investment Representations.

(1)    Investor understands that the BioLargo Shares have not been registered under the Securities Act of 1933, as amended (the “Securities Act”) or any other applicable securities laws, including those under the California Corporations Code. Investor also understands that the BioLargo Shares are being offered and issued pursuant to an exemption from the registration requirements of the Securities Act, under Section 4(2) and/or Regulation D of the Securities Act, and of the California Corporations Code, under Section 25012(f). Investor acknowledges that BioLargo will rely on Investor’s representations, warranties and certifications set forth below for purposes of determining Investor’s suitability as an investor in the BioLargo Shares and for purposes of confirming the availability of the Section 4(2) and/or Regulation D exemption from the registration requirements of the Securities Act, and of the Section 25012(f) exemption under the California Corporations Code.

-3-

(2)    Investor has received all the information it considers necessary or appropriate for deciding whether to acquire the BioLargo Shares, including the information filed by BioLargo with the Securities and Exchange Commission, available on the Internet at www.sec.gov. Investor understands the risks involved in an investment in the BioLargo Shares. Investor further represents that Investor has had an opportunity to ask questions and receive answers from BioLargo regarding the terms and conditions of the offering of the BioLargo Shares and the business, properties, prospects, and financial condition of BioLargo and BET and to obtain such additional information (to the extent BioLargo or BET possessed such information or could acquire it without unreasonable effort or expense) necessary to verify the accuracy of any information furnished to Investor or to which Investor had access. Investor further represents that Investor is an “accredited investor” within the meaning of Rule 501(a) of the Securities Act.

(3)    Investor is acquiring the BioLargo Shares for Investor’s own account for investment only and not with a view towards their resale or “distribution” (within the meaning of the Securities Act) of any part of the BioLargo Shares.

(4)    Investor understands that the BioLargo Shares may not be offered, sold or otherwise transferred except in compliance with the registration requirements of the Securities Act and any other applicable securities laws or pursuant to an exemption therefrom, and in each case in compliance with the conditions set forth in this Agreement. Investor acknowledges and is aware that the BioLargo Shares may not be sold pursuant to Rule 144 adopted under the Securities Act unless certain conditions are met and until Investor has held the security for the applicable holding period under Rule 144.

(5)    Investor acknowledges and agrees that each certificate (or book-entry advice) representing the BioLargo Shares shall bear a legend substantially in the following form:

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE. THE SECURITIES MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH LAWS.”

-4-

(D)    No Reliance. Investor has not relied on and is not relying on any representations, warranties or other assurances regarding BioLargo or BET other than the representations and warranties expressly set forth in this Agreement.

(E)    No Price Manipulation. Investor has not manipulated the price of BioLargo common stock, or shorted, directly or indirectly, shares of BioLargo common stock, during the six months preceding the date of delivery of the Election Notice. The term “Shorting” includes borrowing a security and selling such borrowed security on the open market. Price manipulation includes sales of common stock at the bid price. In the forty (40) business days prior to the Election Notice, Investor has not sold shares of BioLargo common stock, directly or indirectly, on the open market (OTCQB or equivalent).

(b)    Representations and Warranties of BET. BET hereby represents and warrants to Investor and BioLargo, all of which representations and warranties are true, complete, and correct in all respects as of the date hereof and will be as of the Closing, as follows:

(A)    Organization and Qualification. BET is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation.

(B)    Authorization; No Restrictions, Consents or Approvals. BET has full power and authority to enter into and perform its obligations under this Agreement. This Agreement has been duly executed by BET and constitutes the legal, valid, binding and enforceable obligation of BET, enforceable against BET in accordance with its terms. The execution and delivery of this Agreement and the consummation by BET of the transactions contemplated herein do not and will not on the Closing (A) conflict with or violate any of the terms of the articles of incorporation and bylaws of BET or any applicable law relating to BET, (B) conflict with, or result in a breach of any of the terms of, or result in the acceleration of any indebtedness or obligations under, any material agreement, obligation or instrument by which BET is bound or to which any property of BET is subject, or constitute a default thereunder, other than those material agreements, obligations or instruments for which BET has obtained consent for the transactions contemplated under this Agreement, (C) result in the creation or imposition of any lien on any of the assets of BET, (D) constitute an event permitting termination of any material agreement or instrument to which BET is a party or by which any property or asset of BET is bound or affected, pursuant to the terms of such agreement or instrument, other than those material agreements or instruments for which BET has obtained consent for the transactions contemplated under this Agreement, or (E) conflict with, or result in or constitute a default under or breach or violation of or grounds for termination of, any license, permit or other governmental authorization to which BET is a party or by which BET may be bound, or result in the violation by BET of any laws to which BET may be subject, which would materially adversely affect the transactions contemplated herein. No authorization, consent or approval of, notice to, or filing with, any public body or governmental authority or any other person is necessary or required in connection with the execution and delivery by BET of this Agreement or the performance by BET of its obligations hereunder.

-5-

(c)    Representations and Warranties of BioLargo. BioLargo hereby represents and warrants to Investor and BET, all of which representations and warranties are true, complete, and correct in all respects as of the date hereof and will be as of the Closing, as follows:

(A)    Organization and Qualification. BioLargo is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation.

(B)    Authorization; No Restrictions, Consents or Approvals. BioLargo has full power and authority to enter into and perform its obligations under this Agreement. This Agreement has been duly executed by BioLargo and constitutes the legal, valid, binding and enforceable obligation of BioLargo, enforceable against BioLargo in accordance with its terms. The execution and delivery of this Agreement and the consummation by BioLargo of the transactions contemplated herein (including the issuance of the BioLargo Shares in exchange for the Tendered Shares) do not and will not on the Closing (A) conflict with or violate any of the terms of the articles of incorporation and bylaws of BioLargo or any applicable law relating to BioLargo, (B) conflict with, or result in a breach of any of the terms of, or result in the acceleration of any indebtedness or obligations under, any material agreement, obligation or instrument by which BioLargo is bound or to which any property of BioLargo is subject, or constitute a default thereunder, other than those material agreements, obligations or instruments for which BioLargo has obtained consent for the transactions contemplated under this Agreement, (C) result in the creation or imposition of any lien on any of the assets of BioLargo, (D) constitute an event permitting termination of any material agreement or instrument to which BioLargo is a party or by which any property or asset of BioLargo is bound or affected, pursuant to the terms of such agreement or instrument, other than those material agreements or instruments for which BioLargo has obtained consent for the transactions contemplated under this Agreement, or (E) conflict with, or result in or constitute a default under or breach or violation of or grounds for termination of, any license, permit or other governmental authorization to which BioLargo is a party or by which BioLargo may be bound, or result in the violation by BioLargo of any laws to which BioLargo may be subject, which would materially adversely affect the transactions contemplated herein. No authorization, consent or approval of, notice to, or filing with, any public body or governmental authority or any other person is necessary or required in connection with the execution and delivery by BioLargo of this Agreement or the performance by BioLargo of its obligations hereunder.

-6-

(C)    Issuance of Shares. The BioLargo Shares have been duly authorized and, upon issuance in accordance with the terms hereof, shall be validly issued and free from all taxes, liens and charges with respect to the issue thereof, and the BioLargo Shares shall be fully paid and non-assessable with the holder being entitled to all rights accorded to a holder of BioLargo Class B common stock.

(D)    Investment Representations

(1)    BioLargo understands that the Tendered Shares have not been registered under the Securities Act of 1933, as amended (the “Securities Act”) or any other applicable securities laws, including those under the California Corporations Code. BioLargo also understands that the Tendered Shares are being offered pursuant to an exemption from the registration requirements of the Securities Act, under Section 4(2) and/or Regulation D of the Securities Act, and of the California Corporations Code, under Section 25012(f). BioLargo acknowledges that Investor will rely on BioLargo representations, warranties and certifications set forth below for purposes of determining BioLargo suitability as an investor in the Tendered Shares and for purposes of confirming the availability of the Section 4(2) and/or Regulation D exemption from the registration requirements of the Securities Act, and of the Section 25012(f) exemption under the California Corporations Code.

(2)    No Reliance. BioLargo has not relied on and is not relying on any representations, warranties or other assurances regarding BET other than the representations and warranties expressly set forth in this Agreement.

5.    Closing.

(a)    Conditions to Investor’s Obligations. The obligations of Investor under this Agreement, (including, without limitation, the obligation to transfer the Tendered Shares in exchange for the BioLargo Shares) shall be subject to satisfaction of the following conditions, unless waived by Investor: (i) BET and BioLargo shall have performed in all material respects all agreements, and satisfied in all material respects all conditions on its part to be performed or satisfied hereunder, at or prior to the Closing; (ii) all of the representations and warranties of BET and BioLargo herein shall have been true and correct in all respects when made, shall have continued to have been true and correct in all respects at all times subsequent thereto, and shall be true and correct in all material respects on and as of the Closing as though made on, as of, and with reference to such Closing; (iii)  BioLargo shall have executed and be prepared to deliver to its transfer agent all documents necessary to issue the BioLargo Shares to Investor, as contemplated by this Agreement; and (iv) BET and BioLargo shall have obtained or made, as applicable, all consents, authorizations and approvals from, and all declarations, filings and registrations required to consummate the transactions contemplated by this Agreement, including all items required under the incorporation document and bylaws of BET and BioLargo, respectively.

-7-

(b)    Conditions to BioLargo’ Obligations. The obligations of BioLargo under this Agreement, (including, without limitation, the obligation to issue the BioLargo Shares in exchange for the transfer by Investor of the Tendered Shares) shall be subject to satisfaction of the following conditions, unless waived by BioLargo: (i) Investor shall have performed in all respects all agreements, and satisfied in all respects all conditions on their part to be performed or satisfied hereunder, at or prior to the Closing; (ii) all of the representations and warranties of Investor herein shall have been true and correct in all material respects when made, shall have continued to have been true and correct in all material respects at all times subsequent thereto, and shall be true and correct in all material respects on and as of the Closing as though made on, as of, and with reference to such Closing; and (iii) Investor shall have executed and delivered to BioLargo all documents necessary to transfer the Tendered Shares to BioLargo, as contemplated by this Agreement (including those documents described in Section 4(c)).

(c)    Closing Documents. At the Closing,

(A)    Investor shall deliver to BioLargo, in form and substance reasonably satisfactory to BioLargo, (i) a fully executed and notarized Stock Power transferring the Tendered Shares, in the form attached hereto as Exhibit B, and (ii) a filled out and signed IRS Form W-9;

(B)    BioLargo shall deliver to Investor a Direct Registration Book-Entry Advice (delivered by its transfer agent in normal course following the Closing), representing the issuance of the BioLargo Shares, registered in the name of Investor.

(C)    BET shall deliver to BioLargo evidence that the Tendered Shares have been transferred and assigned to BioLargo on the books and records of BET.

6.    Survival of Representations and Warranties. None of the representations, warranties and covenants of Investor, BET or BioLargo hereto contained in this Agreement shall survive the Closing, except that the representations and warranties contained in Section 3(a)(i), Section 3(b)(i), Section 3(b)(ii), Section 3(b)(iii), Section 3(c)(i), and Section 3(c)(ii) shall survive until the latest date permitted by applicable law. Except as specifically set forth in the preceding sentence, no other representation, warranty or covenant of any party set forth in this Agreement will survive the Closing, and no party will have any rights or remedies after the Closing with respect to any misrepresentation of or inaccuracy in any such representation, warranty or covenant

7.    Releases and Waivers of Investor.  Investor hereby generally, irrevocably, unconditionally and completely waives any and all rights to receive any anti-dilution protection to which Investor may be entitled under the articles of incorporation, bylaws or other organizational documents of BET or BioLargo or under any other agreement or instrument in connection with the Exchange. Except for the BioLargo Shares to be issued in connection with the Exchange, Investor hereby generally, irrevocably, unconditionally and completely waives any and all rights existing as of the date hereof to receive options, depository receipts, warrants, stock appreciation or similar rights to acquire or receive securities in BET or BioLargo.

-8-

8.    Notices. All notices or other communications required or permitted hereunder (a “Notice”) shall be in writing, and shall be (a) personally delivered, sent by national overnight courier service, or sent by registered or certified mail, first class postage prepaid, return receipt requested, or (b) sent by electronic mail, but only if either (i) at least one recipient of the Notice (or legal counsel if identified below), acknowledges receipt of such transmission by email or (ii) a confirming copy of the Notice is sent by first class mail or one of the methods set forth in clause (a), above, not later than the first business day following transmission. Personally and courier delivered notices shall be deemed given upon actual personal delivery to designated address of the intended recipient. Mailed notices shall be deemed given upon the date of actual receipt as evidenced by the return receipt. Electronically mailed notices shall be deemed given upon the date the email is transmitted if transmitted without indication of delivery failure prior to 5:00 p.m. local time for the sender (and if transmitted without indication of delivery failure after 5:00 p.m. local time for the sender, then delivery will be deemed duly given at 9:00 a.m. local time for the sender on the subsequent business day). Any Notice shall be sent, transmitted or delivered, as applicable, to the applicable parties at the following addresses:

BioLargo Energy Technologies, Inc.

14921 Chestnut St.

Westminster, CA 92683

Email: dennis.calvert@biolargo.com

With copy to: John R. Browning

Browning Law Group, APC

18818 Teller Ave, Suite 115

Irvine, CA 92612

Email: john@browninglawgroup.com

BioLargo, Inc.

14921 Chestnut St.

Westminster, CA 92683

Email: dennis.calvert@biolargo.com

With copy to: John R. Browning

Browning Law Group, APC

18818 Teller Ave, Suite 115

Irvine, CA 92612

Email: john@browninglawgroup.com

Investor: at the address set forth on Investor’s subscription agreement, or, if different, the address set forth on the W-9 delivered by Investor to BioLargo and BET in accordance with Section 2.

-9-

9.    General Provisions.

(a)    Entire Agreement. This Agreement supersedes any and all other agreements, either oral or in writing, between the parties with respect to the subject matter hereof and contains all of the covenants and agreements between the parties with respect to the transfer of the Shares and the BioLargo Shares. Each party to this Agreement acknowledges that no representations, inducements, promises or agreements, orally or otherwise, have been made by any party, or anyone acting on behalf of any party, which are not embodied herein, and that no other agreement, statement or promise not contained in this Agreement shall be valid or binding on either party.

(b)    Attorneys’ Fees and Costs. In the event that any legal proceeding is brought to enforce or interpret any of the rights or obligations under this Agreement, the prevailing party shall be entitled to recover reasonable attorneys’ fees, costs and disbursements in addition to any other relief to which the prevailing party may be entitled.

(c)    Governing Law; Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of California. Venue for any legal or equitable action between the Company and Stockholder which relates to this Agreement shall be in the county of Orange.

(d)    Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original but all of which shall constitute one and the same instrument.

[SIGNATURE PAGE FOLLOWS]

-10-

IN WITNESS WHEREOF, the parties have executed this Share Exchange Agreement on the day and year first indicated above.

BioLargo Energy Technologies, Inc.

By:                                                      

         Dennis P. Calvert, President                  

BioLargo, Inc.

By:                                                       

Dennis P. Calvert, President                   

INVESTOR: _____________________________________

By:                                                        

Name: ______________________

Title (if applicable): _______________________

Shares of BioLargo Energy Technologies purchased: ________________

Investment amount: $____________

Purchase date: __________________

-11-

EXHIBIT A

FORM OF ELECTION NOTICE

I, the undersigned Investor, hereby tender the following number of shares of Shares purchased in BioLargo Energy Technologies, Inc. private securities offering dated January 1, 2023, for exchange into BioLargo common stock:

Number of “Tendered Shares”: ______________________

Investor name: ______________________________________

Signature: ___________________________

Name, capacity of signatory: _________________________________

FOR BIOLARGO USE ONLY

Total Shares originally purchased by Investor:
Original investment amount:	$
Investment date:
Date Election Notice received:
Adjusted Purchase Price, if applicable:	$
Conversion Price:	$
BioLargo Shares to issue in exchange:

CALCULATIONS:

Conversion Price is equal to a twenty percent (20%) discount to the average volume weighted average price of BLGO for the twenty (20) trading days preceding the Election Date. The volume weighted average price shall be determined in accordance with the data provided by OTC Markets Group, Inc. (or other exchange if BLGO is then-traded on another exchange).

Election notice MUST be received during the calendar year 2024.

EXHIBIT B

FORM OF IRREVOCABLE STOCK POWER

FOR VALUE RECEIVED, I, _______________, do hereby sell, assign and transfer unto BIOLARGO, INC., _______________ shares of common stock of BIOLARGO ENERGY TECHNOLOGIES, INC., a California corporation (the “Corporation”), standing in my name on the books of the Corporation, and do hereby irrevocably constitute and appoint Biolargo Energy Technologies, Inc., as attorney to transfer said shares on the books of said Corporation, with full power of substitution in the premises.

DATED: ______________

EX-21.1

Exhibit 21.1

List of Subsidiaries of Registrant

BioLargo Life Technologies, Inc., a California corporation

ONM Environmental, Inc., a California corporation

BioLargo Equipment Solutions & Technologies, Inc., a California corporation

BioLargo Water, Inc., a Canadian corporation

BioLargo Development Corp., a California corporation

BioLargo Engineering, Science & Technologies, LLC, a Tennessee limited liability company*

Clyra Medical Technologies, Inc., a California corporation*

BioLargo Energy Technologies, Inc., a California corporation*

* BioLargo owns less than 100% of the ownership interests in this entity.

EX-31.1

EXHIBIT 31.1

Certification of Chief Executive Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Dennis P. Calvert, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of BioLargo, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 17, 2023	By:	/s/ DENNIS P. CALVERT
		Dennis P. Calvert
		Chief Executive Officer

EX-31.2

EXHIBIT 31.2

Certification of Chief Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Charles K. Dargan II, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of BioLargo, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 17, 2023	By:	/s/ CHARLES K. DARGAN II
		Charles K. Dargan II
		Chief Financial Officer

EX-32

EXHIBIT 32

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

AND CHIEF FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Dennis P. Calvert, Chief Executive Officer of BioLargo, Inc., certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge, that the Quarterly Report of BioLargo, Inc. on Form 10-Q for the quarter ended March 31, 2023, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Quarterly Report on Form 10-Q fairly presents in all material respects the financial condition and results of operations of BioLargo, Inc.

Dated: May 17, 2023	By:	/s/ DENNIS P. CALVERT
		Dennis P. Calvert
		President and Chief Executive Officer

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to BioLargo, Inc. and will be retained by BioLargo, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

I, Charles K. Dargan II, Chief Financial Officer of BioLargo, Inc., certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge that the Quarterly Report of BioLargo, Inc. on Form 10-Q for the quarter ended March 31, 2023, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Quarterly Report on Form 10-Q fairly presents in all material respects the financial condition and results of operations of BioLargo, Inc.

Dated: May 17, 2023	By:	/s/ CHARLES K. DARGAN II
		Charles K. Dargan II
		Chief Financial Officer

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to BioLargo, Inc. and will be retained by BioLargo, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document And Entity Information - shares	3 Months Ended
	Mar. 31, 2023	May 15, 2023
Document Information [Line Items]
Entity Central Index Key	0000880242
Entity Registrant Name	BIOLARGO, INC.
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2023
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2023
Document Transition Report	false
Entity File Number	000-19709
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	65-0159115
Entity Address, Address Line One	14921 Chestnut St.
Entity Address, City or Town	Westminster
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	92683
City Area Code	888
Local Phone Number	400-2863
Title of 12(b) Security	Common stock
Trading Symbol	BLGO
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		284,690,284

XML

Consolidated Balance Sheets (Current Period Unaudited) - USD ($)	Mar. 31, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 3,264,000	$ 1,851,000
Accounts receivable, net of allowance	1,380,000	1,064,000
Inventories, net of allowance	135,000	120,000
Prepaid expenses and other current assets	95,000	118,000
Total current assets	4,874,000	3,153,000
Equipment, net of depreciation	391,000	287,000
Other non-current assets	124,000	124,000
Investment in South Korean joint venture	27,000	33,000
Right of use, operating lease, net of amortization	837,000	867,000
Clyra Medical prepaid marketing	394,000	394,000
Total assets	6,647,000	4,858,000
Current liabilities:
Accounts payable and accrued expenses	1,224,000	940,000
Debt obligations	66,000	100,000
Deferred revenue	21,000	17,000
Lease liability	97,000	97,000
Deposits	113,000	184,000
Total current liabilities	1,799,000	1,576,000
Long-term liabilities:
Debt obligations, net of current	302,000	237,000
Lease liability, net of current	747,000	773,000
Total long-term liabilities	1,296,000	1,271,000
Total liabilities	3,095,000	2,847,000
COMMITMENTS AND CONTINGENCIES (Note 12)
STOCKHOLDERS’ EQUITY:
Preferred Series A, $0.00067 Par Value, 50,000,000 Shares Authorized, -0- Shares Issued and Outstanding, at March 31, 2023 and December 31, 2022	0	0
Common stock, $0.00067 Par Value, 550,000,000 Shares Authorized, 284,122,581 and 278,462,706 Shares Issued, at March 31, 2023 and December 31, 2022, respectively	190,000	186,000
Additional paid-in capital	150,191,000	148,435,000
Accumulated deficit	(143,841,000)	(143,594,000)
Accumulated other comprehensive loss	(155,000)	(149,000)
Total BioLargo Inc. and subsidiaries stockholders’ equity	6,385,000	4,878,000
Non-controlling interest	(2,833,000)	(2,867,000)
Total stockholders’ equity	3,552,000	2,011,000
Total liabilities and stockholders’ equity	6,647,000	4,858,000
Entities, Excluding Partially Owned Subsidiary [Member]
Current liabilities:
Accounts payable and accrued expenses	1,224,000	940,000
Partially Owned Subsidiary [Member]
Current liabilities:
Accounts payable and accrued expenses	278,000	238,000
Long-term liabilities:
Debt obligations, net of current	$ 247,000	$ 261,000

XML

Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - $ / shares	Mar. 31, 2023	Dec. 31, 2022
Convertible Preferred Stock, Par Value (in dollars per share)	$ 0.00067	$ 0.00067
Convertible Preferred Stock, Shares Authorized (in shares)	50,000,000	50,000,000
Convertible Preferred Stock, Shares Issued (in shares)	0	0
Convertible Preferred Stock, Shares Outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.00067	$ 0.00067
Common stock, shares authorized (in shares)	550,000,000	550,000,000
Common stock, shares issued (in shares)	284,122,581	278,462,706

XML

Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Revenue from Contract with Customer, Including Assessed Tax	$ 3,742,000	$ 965,000
Cost of revenue
Cost of Goods and Services Sold	(1,932,000)	(444,000)
Gross profit	1,810,000	521,000
Operating expenses:
Selling, general and administrative expenses	1,722,000	1,839,000
Research and development	565,000	392,000
Total operating expenses	2,287,000	2,231,000
Operating loss	(477,000)	(1,710,000)
Other income (expense):
PPP forgiveness	0	174,000
Grant income	31,000	5,000
Interest expense	(48,000)	(13,000)
Total other (expense) income	(17,000)	166,000
Net loss	(494,000)	(1,544,000)
Net (loss) income attributable to noncontrolling interest	(247,000)	108,000
Net loss attributable to common stockholders	$ (247,000)	$ (1,652,000)
Net loss per share attributable to common stockholders:
Loss per share attributable to stockholders – basic and diluted (in dollars per share)	$ (0.0009)	$ (0.0063)
Weighted average number of common shares outstanding: (in shares)	280,711,278	260,805,418
Comprehensive loss attributable to common stockholders
Net loss	$ (494,000)	$ (1,544,000)
Foreign currency translation adjustment	(6,000)	(8,000)
Comprehensive loss	(500,000)	(1,552,000)
Comprehensive (loss) income attributable to noncontrolling interest	(247,000)	108,000
Comprehensive loss attributable to stockholders	(253,000)	(1,660,000)
Product [Member]
Revenue from Contract with Customer, Including Assessed Tax	3,548,000	610,000
Cost of revenue
Cost of Goods and Services Sold	(1,797,000)	(293,000)
Service [Member]
Revenue from Contract with Customer, Including Assessed Tax	194,000	355,000
Cost of revenue
Cost of Goods and Services Sold	$ (135,000)	$ (151,000)

XML

Consolidated Statement of Stockholders' Equity (Deficit) (Unaudited) - USD ($)	Clyra Medical Technologies [Member] Common Stock [Member]	Clyra Medical Technologies [Member] Additional Paid-in Capital [Member]	Clyra Medical Technologies [Member] Retained Earnings [Member]	Clyra Medical Technologies [Member] AOCI Attributable to Parent [Member]	Clyra Medical Technologies [Member] Noncontrolling Interest [Member]	Clyra Medical Technologies [Member]	BioLargo Energy Technologies, Inc (BETI) [Member] Common Stock [Member]	BioLargo Energy Technologies, Inc (BETI) [Member] Additional Paid-in Capital [Member]	BioLargo Energy Technologies, Inc (BETI) [Member] Retained Earnings [Member]	BioLargo Energy Technologies, Inc (BETI) [Member] AOCI Attributable to Parent [Member]	BioLargo Energy Technologies, Inc (BETI) [Member] Noncontrolling Interest [Member]	BioLargo Energy Technologies, Inc (BETI) [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	AOCI Attributable to Parent [Member]	Noncontrolling Interest [Member]	Total
Balance (in shares) at Dec. 31, 2021													255,893,726
Balance at Dec. 31, 2021													$ 171,000	$ 143,718,000	$ (139,121,000)	$ (115,000)	$ (3,720,000)	$ 933,000
Sale of stock for cash (in shares)													6,703,789
Sale of stock for cash													$ 4,000	1,198,000	0	0	0	1,202,000
Issuance of common stock for services (in shares)													86,752
Issuance of common stock for services													$ 0	17,000	0	0	0	17,000
Stock option compensation expense	$ 0	$ 141,000	$ 0	$ 0	$ 0	$ 141,000							0	660,000	0	0	0	660,000
Noncontrolling interest allocation													0	(528,000)	0	0	528,000	0
Net loss													0	0	(1,652,000)	0	108,000	(1,544,000)
Foreign currency translation													$ 0	0	0	(8,000)	0	(8,000)
Balance (in shares) at Mar. 31, 2022													262,684,267
Balance at Mar. 31, 2022													$ 176,000	145,205,000	(140,773,000)	(123,000)	(3,085,000)	1,400,000
Balance (in shares) at Dec. 31, 2022													278,462,706
Balance at Dec. 31, 2022													$ 186,000	148,435,000	(143,594,000)	(149,000)	(2,867,000)	2,011,000
Sale of stock for cash (in shares)													4,201,402
Sale of stock for cash													$ 3,000	797,000	0	0	0	800,000
Issuance of common stock for services (in shares)													930,490
Issuance of common stock for services													$ 1,000	206,000	0	0	0	207,000
Issuance of common stock in exchange for Clyra shares (in shares)													527,983
Stock option compensation expense													$ 0	195,000	0	0	0	195,000
Clyra Medical Technologies, Inc. (Clyra) stock options issued for services	0	61,000	0	0	0	61,000
Warrant issued for interest													0	30,000	0	0	0	30,000
Clyra – sales of Series A Preferred Stock	0	0	0	0	225,000	225,000	$ 0	$ 0	$ 0	$ 0	$ 550,000	$ 550,000
Clyra – Series A Preferred Stock – dividend	$ 0	$ 0	$ 0	$ 0	$ (27,000)	$ (27,000)
Noncontrolling interest allocation													0	467,000	0	0	(467,000)	0
Net loss													0	0	(247,000)	0	(247,000)	(494,000)
Foreign currency translation													$ 0	0	0	(6,000)	0	(6,000)
Balance (in shares) at Mar. 31, 2023													284,122,581
Balance at Mar. 31, 2023													$ 190,000	$ 150,191,000	$ (143,841,000)	$ (155,000)	$ (2,833,000)	$ 3,552,000

XML

Consolidated Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Cash flows from operating activities
Net loss	$ (494,000)	$ (1,544,000)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock option compensation expense	256,000	801,000
Common stock issued for services	207,000	17,000
Interest expense related to amortization of the discount on note payable	3,000	4,000
Fair value of warrant issued for interest	30,000	0
PPP loan forgiveness	0	(174,000)
Loss on investment in South Korean joint venture	6,000	8,000
Depreciation expense	22,000	2,000
Changes in assets and liabilities:
Accounts receivable	(316,000)	(178,000)
Inventories	(17,000)	(29,000)
Prepaid expenses and other assets	25,000	(59,000)
Deferred revenue	4,000	(89,000)
Right of use and lease liability, net	4,000	0
Deposit	(71,000)	12,000
Net cash used in operating activities	(43,000)	(1,140,000)
Cash flows from investing activities
Equipment purchases	(48,000)	(32,000)
Net cash used in investing activities	(48,000)	(32,000)
Cash flows from financing activities
Proceeds from sale of common stock	800,000	1,202,000
Repayment of note payable	(50,000)	0
Repayment by Clyra on inventory line of credit	(15,000)	(10,000)
Proceeds from sale of Clyra Medical preferred stock	225,000	0
Net cash provided by financing activities	1,510,000	1,192,000
Net effect of foreign currency translation	(6,000)	(8,000)
Net change in cash	1,413,000	12,000
Cash at beginning of year	1,851,000	962,000
Cash at end of period	3,264,000	974,000
Supplemental disclosures of cash flow information
Interest	15,000	7,000
Income taxes	5,000	0
Short-term lease payments not included in lease liability	13,000	52,000
Non-cash investing and financing activities
Equipment added via vehicle loan	80,000	0
Allocation of noncontrolling interest	467,000	528,000
Conversion of Clyra Common Stock to BioLargo Common Stock [Member]
Non-cash investing and financing activities
Conversion of Clyra common stock to BioLargo common stock	100,000	0
Conversion of Intercompany Receivable into Clyra Shares [Member]
Non-cash investing and financing activities
Conversion of intercompany receivable into Clyra shares	0	633,000
BETI Common Stock [Member]
Cash flows from financing activities
Proceeds from sale of common stock	550,000	0
Entities, Excluding Partially Owned Subsidiary [Member]
Changes in assets and liabilities:
Accounts payable and accrued expenses	284,000	114,000
Accounts payable and accrued expenses	284,000	114,000
Partially Owned Subsidiary [Member]
Changes in assets and liabilities:
Accounts payable and accrued expenses	14,000	(25,000)
Accounts payable and accrued expenses	$ 14,000	$ (25,000)

XML

Note 1 - Business and Organization

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

Note 1. Business and Organization

Description of Business

BioLargo, Inc. (“BioLargo”, or the “Company”) invents, develops, and commercializes innovative platform technologies to solve challenging environmental problems like PFAS contamination (per- and polyfluoroalkyl substances), advanced water and wastewater treatment, industrial odor control, air quality control, infection control, and myriad environmental remediation challenges. Our business strategy is straightforward: we invent or acquire technologies that we believe have the potential to be disruptive in large commercial markets; we develop and validate these technologies to advance and promote their commercial success as we leverage our considerable scientific, engineering, and entrepreneurial talent; we then monetize these technical assets through a variety of business structures that may include licensure, joint venture, sale, spin off, or by deploying direct to market strategies.

Organization

We are a Delaware corporation formed in 1991. We have five wholly-owned subsidiaries: BioLargo Life Technologies, Inc., organized under the laws of the State of California in 2006; ONM Environmental, Inc., organized under the laws of the State of California in 2009; BioLargo Equipment and Technologies, Inc., organized under the laws of the State of California in 2022; BioLargo Water, Inc. (“Water”), organized under the laws of Canada in 2014; and BioLargo Development Corp., organized under the laws of the State of California in 2016. Additionally, we own 82% (see Note 9) of BioLargo Engineering Science and Technologies, LLC (“BLEST”), organized under the laws of the State of Tennessee in 2017, 58% of Clyra Medical Technologies, Inc. (“Clyra” or “Clyra Medical”), organized under the laws of the State of California in 2012, and 97.1% of BioLargo Energy Technologies, Inc. (“BETI”) organized under the laws of the State of California in 2022. We consolidate the financial statements of our partially owned subsidiaries (see Note 2, subheading “Principles of Consolidation,” and Note 8).

Liquidity / Going concern

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of our business. For the three months ended March 31, 2023, we generated revenues of $3,742,000 through our subsidiaries (see Note 11), had a net loss of $494,000, used $43,000 cash in operations, and at March 31, 2023, we had working capital of $3,075,000, and current assets of $4,874,000. While our operating loss has decreased in recent quarterly periods, as has our cash used in operations, we expect to continue to need further investment capital to fund operations. We have been, and anticipate that we will continue to be, limited in terms of our capital resources.

During the three months ended March 31, 2023, we (i) sold $105,000 of our common stock to Lincoln Park Capital Fund, LLC (“Lincoln Park”) (see Note 3), (ii) sold $695,000 of our common stock and warrants to accredited investors (see Notes 3 and 6), (iii) sold $225,000 of Clyra Medical Series A Preferred Stock (see Note 8), and (iv) sold $550,000 of BETI common stock (see Note 10).

As of March 31, 2023, our cash and cash equivalents totaled $3,264,000. Our total liabilities included a $78,000 vehicle loan, $140,000 due in U.S. Small Business Administration (SBA) loans issued pursuant to the Paycheck Protection Program (see Note 4), $150,000 due to the SBA issued pursuant to the Economic Injury Disaster program (see Note 4), and $247,000 owed by Clyra Medical due in 2024 (see Note 8).

Subsequent to March 31, 2023, we continued to sell common stock to Lincoln Park for working capital as needed (see Note 13).

If we are unable to rely on our current arrangement with Lincoln Park to fund our working capital requirements, we will have to rely on other forms of financing, and there is no assurance that we will be able to do so, or if we do so, it will be on favorable terms.

The foregoing factors raise substantial doubt about our ability to continue as a going concern, unless we are able to continue to raise funds through stock sales to Lincoln Park or other private financings, and in the long term, our ability to attain a reasonable threshold of operating efficiencies and achieve profitable operations by licensing or otherwise commercializing products incorporating our technologies. The consolidated financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.

XML

Note 2 - Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Significant Accounting Policies [Text Block]

Note 2. Summary of Significant Accounting Policies

Principles of Consolidation

The consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries, and partially owned subsidiaries BETI, BLEST and Clyra Medical. All intercompany accounts and transactions have been eliminated.

Foreign Currency

The Company has designated the functional currency of BioLargo Water, Inc., our Canadian subsidiary, to be the Canadian dollar. Therefore, translation gains and losses resulting from differences in exchange rates are recorded in accumulated other comprehensive income.

Cash and Cash Equivalents

The Company considers all highly liquid investments with maturities of three months or less when acquired to be cash equivalents. Substantially all cash equivalents are held in short-term money market accounts at one of the largest financial institutions in the United States, Bank of America. From time to time, our cash account balances are greater than the Federal Deposit Insurance Corporation insurance limit of $250,000 per owner per bank, and during such times, we are exposed to credit loss for amounts in excess of insured limits in the event of non-performance by the financial institution. We do not anticipate non-performance by our financial institution.

As of March 31, 2023, and December 31, 2022, our cash balances were made up of the following (in thousands):

	March 31, 2023		December 31, 2022
BioLargo, Inc. and subsidiaries	$	3,171	$	1,685
Clyra Medical Technologies, Inc.		93		166
Total	$	3,264	$	1,851

Accounts Receivable

Trade accounts receivable are recorded net of allowances for doubtful accounts. Estimates for allowances for doubtful accounts are determined based on payment history and individual customer circumstances. The allowance for doubtful accounts as of March 31, 2023, and  December 31, 2022 was $12,000.

Credit Concentration

We have a limited number of customers that account for significant portions of our revenue. During the three months ended March 31, 2023, one customer accounted for more than 10% of consolidated revenues, and during the three months ended March 31, 2022, two customers each accounted for more than 10% of consolidated revenues:

	March 31, 2023			March 31, 2022
Customer A		86	%		29	%
Customer B	<10		%		14	%

At March 31, 2023, and December 31, 2022, one customer accounted for more than 10% of consolidated accounts receivable:

	March 31, 2023			December 31, 2022
Customer A		70	%		24	%

Inventory

Inventories are stated at the lower of cost or net realizable value using the average cost method. The allowance for obsolete inventory as of  March 31, 2023, and December 31, 2022, was $158,000. Inventories consisted of (in thousands):

	March 31, 2023		December 31, 2022
Raw material	$	52	$	46
Finished goods		83		74
Total	$	135	$	120

Other Non-Current Assets

Other non-current assets consisted of (i) security deposits related to our business offices, (ii) three patents acquired on  October 22, 2021, for $34,000, and (iii) tax credit receivables from the Canadian government related to a research and development credit from our Canadian subsidiary for which we’ve applied for and received in prior periods.

	March 31, 2023		December 31, 2022
Patents	$	34	$	34
Security deposits		36		36
Tax credit receivable		54		54
Total	$	124	$	124

Equity Method of Accounting

On March 20, 2020, we invested $100,000 into a South Korean entity (Odin Co. Ltd., “Odin”) pursuant to a Joint Venture agreement we had entered into with BKT Co. Ltd. and its U.S. based subsidiary, Tomorrow Water. We received a 40% non-dilutive equity interest, and BKT and Tomorrow Water each received 30% equity interests for an aggregate $150,000 investment.

We account for our investment in the joint venture under the equity method of accounting. We have determined that while we have significant influence over the joint venture through our technology license and our position on the Board of Directors, we do not control the joint venture or are otherwise involved in managing the entity and we own less than a majority of the equity. Therefore, we record the asset on our consolidated balance sheet and record an increase or decrease the recorded balance by our percentage ownership of the profits or losses in the joint venture. The joint venture has incurred a loss since inception and our 40% ownership share reduced our investment interest during the three months ended March 31, 2023, and 2022, by $6,000 and $8,000, respectively.

Impairment

Long-lived and definite lived intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If the sum of the expected future undiscounted cash flows from the use of the asset and its eventual disposition is less than the carrying amount of the asset, then an impairment loss is recognized. The impairment loss is measured based on the fair value of the asset. Any resulting impairment is recorded as a reduction in the carrying value of the related asset in excess of fair value and a charge to operating results.

Earnings (Loss) Per Share

We report basic and diluted earnings (loss) per share (“EPS”) for common and common share equivalents. Basic EPS is computed by dividing reported earnings by the weighted average shares outstanding. Diluted EPS is computed by adding to the weighted average shares the dilutive effect if convertible notes payable, stock options and warrants were exercised into common stock. For the three months ended March 31, 2023, and 2022, the denominator in the diluted EPS computation is the same as the denominator for basic EPS due to the Company’s net loss which creates an anti-dilutive effect of the convertible notes payable, warrants and stock options.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and revenues and expenses during the period reported. Actual results could differ from those estimates. Estimates are used when accounting for stock-based transactions, debt transactions, derivative liabilities, allowance for bad debt, asset depreciation and amortization, impairment expense, among others.

The methods, estimates and judgments we use in applying these most critical accounting policies have a significant impact on the results of our financial statements.

Share-Based Compensation Expense

We recognize compensation expense for stock option awards on a straight-line basis over the applicable service period of the award, which is the vesting period. Fair value is determined on the grant date. Share-based compensation expense is based on the grant date fair value estimated using the Black-Scholes Option Pricing Model.

For stock and stock options issued to consultants and other non-employees for services, the Company measures and records an expense as of the earlier of the date at which either: a commitment for performance by the non-employee has been reached or the non-employee’s performance is complete. The equity instruments are measured at the current fair value, and for stock options, the instruments are measured at fair value using the Black Scholes option model.

The following methodology and assumptions were used to calculate share-based compensation for the three months ended March 31, 2023, and 2022:

	2023						2022
	Non Plan			2018 Plan			Non Plan			2018 Plan
Risk free interest rate		3.48	%		3.48	%	2.32	–	3.83%	2.32	–	3.83%
Expected volatility		114	%		114	%	114	–	117%	114	–	117%
Expected dividend yield		—			—			—			—
Forfeiture rate		—			—			—			—
Life in years		10			10			10			10

Expected price volatility is the measure by which our stock price is expected to fluctuate during the expected term of an option. The expected volatility is derived from the historical daily change in the market price of our common stock, as we believe that historical volatility is the best indicator of future volatility.

The risk-free interest rate used in the Black-Scholes calculation is based on the prevailing U.S. Treasury yield as determined by the U.S. Federal Reserve. We have never paid any cash dividends on our common stock and do not anticipate paying cash dividends on our common stock in the foreseeable future.

Warrants

Warrants issued with our convertible and non-convertible debt instruments are accounted for under the fair value and relative fair value method.

The warrant is first analyzed per its terms as to whether it has derivative features or not. If the warrant is determined to be a derivative and not qualify for equity treatment, then it is measured at fair value using the Black Scholes option model and recorded as a liability on the balance sheet. The warrant is re-measured at its then current fair value at each subsequent reporting date (it is “marked-to-market”).

If the warrant is determined to not have derivative features, it is recorded into equity at its fair value using the Black Scholes option model, however, limited to a relative fair value based upon the percentage of its fair value to the total fair value including the fair value of the convertible note.

Convertible debt instruments are recorded at fair value, limited to a relative fair value based upon the percentage of its fair value to the total fair value including the fair value of the warrant.

The warrant relative fair values are also recorded as a discount to the convertible promissory notes. As present, these equity features of the convertible promissory notes have recorded a discount to the convertible notes that is substantially equal to the proceeds received.

Non-Cash Transactions

We determine the value assigned to each intangible we acquire, and/or services or products received for non-cash consideration of our common stock based on the market price of our common stock issued as consideration, at the date of the agreement of each transaction or when the service is rendered or product is received.

Revenue Recognition

We account for revenue in accordance with ASC 606, “Revenue from Contacts with Customers”. The guidance focuses on the core principle for revenue recognition, which is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, the guidance provides that an entity should apply the following steps:

Step 1: Identify the contract(s) with a customer.

Step 2: Identify the performance obligations in the contract.

Step 3: Determine the transaction price.

Step 4: Allocate the transaction price to the performance obligations in the contract.

Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation.

The Company’s products are sold through a contract with the customer and a written purchase order, in which the details of the contract are defined including the transaction price and method of shipment. The only performance obligation is to create and ship the product, and each product has separate pricing. Revenue is recognized at a point in time when the goods are shipped if the agreement is FOB manufacturer, and when goods are delivered if FOB destination. Revenue is recognized with a reduction for sales discounts, as appropriate and negotiated in the customer’s purchase order.

Service contracts are performed through a written contract, which specifies the performance obligations and the rate at which the services will be billed, typically by time and materials. Each service is separately negotiated and priced. Revenue is recognized as services are performed and completed, or, for services related to product installations, at the completion of the installation. A few contracts have called for milestone or fixed cost payments, where we invoice an agreed-to amount per month for the life of the contract. In these instances, completed work, billed hourly, is recognized as revenue. If the billing amount is greater or lesser than the completed work, a receivable or payable is created. These accounts are adjusted upon additional billings as the work is completed. To date, there have been no discounts or other financing terms for the contracts.

The Company has outstanding contract liability obligations of $21,000 as of March 31, 2023, recorded as deferred revenue. We recognized $8,000 in revenue and reduce the deferred revenue balance by the same amount as performance obligations were satisfied in the three months ended March 31 ,2023. The outstanding balance will be recognized over the remaining life of the contracts.

As we generate revenues from royalties or license fees from our intellectual property, a licensee will pay a license fee in one or more installments and ongoing royalties based on their sales of products incorporating or using our licensed intellectual property. We have entered into a licensing agreement for the CupriDyne Clean product, and we recognize royalty and license fees on a quarterly basis as the product is sold through to third parties and reported to us.

Clyra also has certain distribution agreements that call for consigned inventory. Although the product is shipped to a third party, it is not revenue until that consigned inventory is sold to end user customer.

Government Grants

We have been awarded multiple research grants from the private and public Canadian research programs. The income we receive directly from grants is recorded as other income. We have been awarded over 80 grants since our first in 2015. Some of the funds from these grants are given directly to third parties (such as the University of Alberta or a third-party research scientist) to support research on our technology. The grants have terms generally ranging between six and eighteen months and support a majority, but not all, of the related research budget costs. This cooperative research allows us to utilize (i) a depth of resources and talent to accomplish highly skilled work, (ii) financial aid to support research and development costs, (iii) independent and credible validation of our technical claims.

The grants typically provide for (i) recurring monthly amounts, (ii) reimbursement of costs for research talent for which we invoice to request payment, and (iii) ancillary cost reimbursement for research talent travel related costs. All awarded grants have specific requirements on how the money is spent, typically to employ researchers. None of the funds may be used for general administrative expenses or overhead in the United States. These grants have substantially increased our level of research and development activities in Canada. We continue to apply for Canadian government and agency grants to fund research and development activities. Not all of our grant applications have been awarded, and no assurance can be made that any pending grant application, or any future grant applications, will be awarded.

Income Taxes

The asset and liability approach is used to recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of asset and liabilities. Deferred tax assets and liabilities are determined based on the differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The effect on deferred tax asset and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

We account for uncertainties in income tax law under a comprehensive model for the financial statement recognition, measurement, presentation, and disclosure of uncertain tax positions taken or expected to be taken in income tax returns as prescribed by generally accepted accounting principles (“GAAP”).  Under GAAP, the tax effects of a position are recognized only if it is “more-likely-than-not” to be sustained by the taxing authority as of the reporting date.  If the tax position is not considered “more-likely-than-not” to be sustained, then no benefits of the position are recognized.  Management believes there are no unrecognized tax benefits or uncertain tax positions as of March 31, 2023, and December 31, 2022.

The Company assessed its earnings history, trends and estimates of future earnings and determined that the deferred tax asset could not be realized as of March 31, 2023, and December 31, 2022. Accordingly, a valuation allowance was recorded against the net deferred tax asset.

The Company recognizes interest and penalties on income taxes as a component of income tax expense, should such an expense be realized.

Fair Value of Financial Instruments

Management believes the carrying amounts of the Company’s financial instruments as of March 31, 2023 and December 31, 2022 approximate their respective fair values because of the short-term nature of these instruments. Such instruments consist of cash, accounts receivable, prepaid assets, accounts payable, line of credit, and other assets and liabilities. The carrying amount of debt instruments are believed to approximate fair value as the stated interest rates are reflective of the prevailing market rates.

Tax Credits

Our research and development activities in Canada may entitle our Canadian subsidiary to claim benefits under the “Scientific Research and Experimental Development Program”, a Canadian federal tax incentive program designed to encourage Canadian businesses of all sizes and in all sectors to conduct research and development in Canada. Benefits under the program include credits to taxable income. If our Canadian subsidiary does not have taxable income in a reporting period, we instead receive a tax refund from the Canadian Revenue Authority. Those refunds are classified in Other Income on our Consolidated Statement of Operations and Comprehensive Loss.

Leases

At inception of a lease contract, we assess whether the contract is, or contains, a lease. Our assessment is based on: (1) whether the contract involves the use of a distinct identified asset, (2) whether we obtain the right to substantially all the economic benefit from the use of the asset throughout the period of the contract, and (3) whether we have the right to direct the use of the asset during such time period. At inception of a lease, we allocate the consideration in the contract to each lease component based on its relative stand-alone price to determine the lease payments. Leases are classified as either finance leases or operating leases. A lease must be classified as a finance lease if any of the following criteria are met: the lease transfers ownership of the asset by the end of the lease term, the lease contains an option to purchase the asset that is reasonably certain to be exercised, the lease term is for a major part of the remaining useful life of the asset or the present value of the lease payments equals or exceeds substantially all of the fair value of the asset. A lease is classified as an operating lease if it does not meet any of these criteria. We have no leases classified as finance leases. As of March 31, 2023, the weighted average remaining lease term for our operating leases was nine years. The weighted average discount rate for our operating leases was 18%. For all leases at the lease commencement date, a right-of-use asset and a lease liability are recognized. The right-of-use asset represents the right to use the leased asset for the lease term. The lease liability represents the present value of the lease payments under the lease. The right-of-use asset is initially measured at cost, which primarily comprises the initial amount of the lease liability, plus any initial direct costs incurred, consisting mainly of brokerage commissions, less any lease incentives received. All right-of-use assets are reviewed for impairment. The lease liability is initially measured at the present value of the lease payments, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, management estimates the incremental borrowing rate, which currently is estimated to be 18%. Lease payments included in the measurement of the lease liability comprise the following: the fixed noncancelable lease payments, payments for optional renewal periods where it is reasonably certain the renewal period will be exercised, and payments for early termination options unless it is reasonably certain the lease will not be terminated early. Lease components are included in the measurement of the initial lease liability. Additional payments based on a change in our portion of the operating expenses, including real estate taxes and insurance, are recorded as a period expense when incurred. Lease modifications result in remeasurement of the lease liability. Lease expense for operating leases consists of the lease payments plus any initial direct costs, primarily brokerage commissions, and is recognized on a straight-line basis over the lease term. We have elected not to recognize right-of-use assets and lease liabilities for short-term leases that have a term of 12 months or less. The effect of short-term leases on our right-of-use asset and lease liability was not material.

As of March 31, 2023, the right-of-use assets totaled $837,000 and the lease liability totaled $844,000 on our balance sheet related to our operating leases.

Equipment

Equipment is stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, which range from 3 - 5 years. Additions, renewals, and betterments that significantly extend the life of the asset are capitalized. Expenditures for repairs and maintenance are charged to expense as incurred. For assets sold or otherwise disposed of, the cost and related accumulated depreciation and amortization are removed from the accounts, and any related gain or loss is reflected in income for the period.

Measurement of Credit Losses on Financial Instruments

In June 2016, the FASB issued ASU 2016-13, which sets out the principles for the recognition of measurement of credit losses on financial instruments, including trade receivables. The standard eliminates the probable initial recognition threshold and requires an entity to reflect its current estimate of all expected credit losses. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected. The new standard was effective for the Company beginning January 1, 2023 and primarily impacted trade accounts receivable. 

Accounts receivable are customer obligations that are unconditional. Accounts receivable are presented net of an allowance for doubtful accounts for expected credit losses, which represents an estimate of amounts that may not be collectible. The Company performs ongoing credit evaluations of its customers and, if necessary, provides an allowance for doubtful accounts and expected credit losses. A provision to the allowances for doubtful accounts for expected credit losses is recorded based on factors including the length of time the receivables are past due, the current business environment, and the Company’s historical experience. Provisions to the allowances for doubtful accounts for expected credit losses are recorded to general and administrative expenses. The Company writes off accounts receivable against the allowance when it determines a balance is uncollectible and no longer actively pursues collection of the receivable. The Company does not have any off-balance-sheet credit exposure related to customers. As of March 31, 2023 and December 31, 2022, the allowance for doubtful accounts for expected credit losses was $12,000.

Recent Accounting Pronouncements

Currently there are no recently released pronouncements that are considered applicable to the Company’s financial statements.

XML

Note 3 - Sale of Stock for Cash

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Stock Purchase Agreement [Text Block]

Note 3. Sale of Stock for Cash

Lincoln Park Financing

On December 13, 2022, we entered into a stock purchase agreement (the “2022 LPC Purchase Agreement”) with Lincoln Park, pursuant to which Lincoln Park agreed to purchase from us at our request up to an aggregate of $10,000,000 of our common stock (subject to certain limitations) from time to time over a period of three years. The agreement allows us, at our sole discretion, to direct Lincoln Park to purchase shares of our common stock, subject to limitations in both volume and dollar amount. The purchase price of the shares that may be sold to Lincoln Park under the agreement is the lower of (i) the lowest sale price on the date of purchase, or (ii) the average of the three lowest closing prices in the prior 12 business days. There are no restrictions on future financings, rights of first refusal, participation rights, penalties, or liquidated damages other than a prohibition on entering into a “Variable Rate Transaction,” as defined in the agreement. Concurrently with the 2022 LPC Purchase Agreement, we entered into a Registration Rights Agreement, pursuant to which we filed a registration statement on Form S-1 with the SEC on December 23, 2022. This registration statement was declared effective on January 19, 2023.

During the three months ended March 31, 2023, and 2022, we sold 545,402 and 1,506,821 shares of our common stock to Lincoln Park, and received $105,000 and $346,000, respectively, in gross and net proceeds.

Unit Offerings

During the three months ended March 31, 2023, and 2022, we sold 3,656,000 and 5,196,968 shares of our common stock and received $695,000 and $856,000 in gross and net proceeds from accredited investors. In addition to the shares, we issued each investor a six-month and a five-year warrant to purchase additional shares. (See Note 6, “Warrants Issued in Unit Offering”.)

XML

Note 4 - Debt Obligations

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Debt Disclosure [Text Block]

Note 4. Debt Obligations

The following table summarizes our debt obligations outstanding as of March 31, 2023, and December 31, 2022 (in thousands). The table does not include debt obligations of our partially owned subsidiary Clyra Medical (see Note 8, “Debt Obligations of Clyra Medical”).

	March 31, 2023		December 31, 2022
Current portion of debt:
SBA Paycheck Protection Program loan	$	43	$	43
Vehicle loan, current portion		13		—
Convertible note payable, matures March 1, 2023		—		50
SBA EIDL Loan, matures July 2053, current portion		10		10
Debt discount, net of amortization		—		(3	)
Total current portion of debt	$	66	$	100
Long-term debt:
SBA Paycheck Protection Program loans, matures May 2025	$	97	$	97
Vehicle loan, matures March 2029		65		—
SBA EIDL Loan, matures July 2053		140		140
Total long-term debt, net of current	$	302	$	237
Total	$	368	$	337

For the three months ended March 31, 2023, and 2022, we recorded $48,000 and $13,000 of interest expense related to the amortization of discounts on convertible notes payable and coupon interest from our convertible notes and lines of credit.

Vehicle loan

On February 7, 2023, we entered a loan agreement with Bank of America for the purchase of a vehicle used in operations totaling $80,000, at 5.29% annual interest which matures March 7, 2029. The loan agreement requires monthly payments of $1,118.

Convertible note payable, matures March 1, 2023

On March 6, 2023, we entered into an agreement with the holder of a $50,000 note to convert that note into common stock of BETI (see note 10). As payment for interest, a warrant to purchase 200,000 shares of BioLargo common stock at $0.21 was issued to the investor, expiring five years from the grant date. (See Note 6).

SBA Program Loans

On  February 7, 2022, we received notice that the SBA had forgiven $173,821 of ONM Environmental's $217,243 Paycheck Protection Program (PPP) loan. ONM has appealed this decision. On May 12, 2022, we received notice that the SBA had denied the forgiveness application of BLEST’s $97,000 PPP loan. We have appealed that decision. During the period upon which a forgiveness decision is on appeal, loan payments are deferred. The maturity date of the BLEST PPP loan was officially extended on our request to May 2025.

In July 2020, ONM Environmental received an Economic Injury Disaster Loan from the SBA in the amount of $150,000. The note has a 3.75% annual interest rate. For the three months ended March 31, 2023, interest expense totaled $2,000.

XML

Note 5 - Share-based Compensation

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Compensation and Employee Benefit Plans [Text Block]

Note 5. Share-Based Compensation

Issuance of Common Stock in exchange for Services

Payment of Officer Salaries

On March 31, 2023, an officer agreed to convert an aggregate $6,000 of accrued and unpaid salary into 30,747 shares of our common stock at $0.20 per share. Shares issued to Officers are unvested at the date of grant and subject to a lock-up agreement restricting vesting and sale until the earlier of (i) the consummation of a sale (in a single transaction or in a series of related transactions) of BioLargo by means of a sale of (a) a majority of the then outstanding common stock of BioLargo (whether by merger, consolidation, sale or transfer of common stock, reorganization, recapitalization or otherwise) or (b) all or substantially all of the assets of BioLargo; and (ii) the successful commercialization of BioLargo’s products or technologies as demonstrated by its receipt of at least $3,000,000 in cash, or the recognition of $3,000,000 in revenue, over a 12-month period from the sale of products and/or the license of technology; and (iii) the Company’s breach of the employment agreement between the Company and Officer and resulting in Officer’s termination.

Payment of Consultant Fees

On  March 31, 2023, we issued 899,743 shares of our common stock at $0.20 per share in lieu of $201,000 of accrued and unpaid obligations to consultants.

On  March 31, 2022, we issued 86,752 shares of our common stock at $0.23 per share in lieu of $17,000 of accrued and unpaid obligations to consultants. 

All of these offerings and sales were made in reliance on the exemption from registration contained in Section 4(2) of the Securities Exchange Act and/or Regulation D promulgated thereunder as not involving a public offering of securities.

Stock Option Expense

During the three months ended March 31, 2023, and 2022, we recorded an aggregate $256,000 and $801,000, respectively, in selling general and administrative expense related to the issuance of stock options. We issued options through our 2018 Equity Incentive Plan, and outside of this plan. Within these totals, $61,000 and $141,000 were issued by our subsidiary Clyra Medical (see Note 8).

2018 Equity Incentive Plan

On June 22, 2018, our stockholders adopted the BioLargo 2018 Equity Incentive Plan (“2018 Plan”) as a means of providing our directors, key employees, and consultants additional incentive to provide services. Both stock options and stock grants may be made under this plan for a period of 10 years. It is set to expire on its terms on June 22, 2028. Our Board of Director’s Compensation Committee administers this plan. As plan administrator, the Compensation Committee has sole discretion to set the price of the options. The plan authorizes the following types of awards: (i) incentive and non-qualified stock options, (ii) restricted stock awards, (iii) stock bonus awards, (iv) stock appreciation rights, (v) restricted stock units, and (vi) performance awards. The total number of shares reserved and available for awards pursuant to this Plan as of the date of adoption of this 2018 Plan by the Board is 40 million shares. The number of shares available to be issued under the 2018 Plan increases automatically each January 1^st by the lesser of (a) 2 million shares, or (b) such number of shares determined by our Board. As of March 31, 2023, 50,000,000 shares are authorized under the plan.

Activity for our stock options under the 2018 Plan during the three months ended March 31, 2023, and 2022, is as follows:

	Options Outstanding			Exercise Price per share				Weighted Average Price per share		Aggregate intrinsic Value(1)
Balance, December 31, 2022		28,484,549		$0.12	–	0.43	$	0.19
Granted		1,320,498			$0.20		$	0.2
Balance, March 31, 2023		29,805,047		$0.12	–	0.43	$	0.19
Unvested		(4,073,761	)	$0.12	–	0.32	$	0.19
Vested, March 31, 2023		25,731,286		$0.12	–	0.43	$	0.19	$	678,000
Balance, December 31, 2021		23,186,142		$0.16	–	0.40	$	0.19
Granted		2,621,229		$0.12	–	0.23	$	0.23
Balance, March 31, 2022		25,807,371		$0.12	–	0.40	$	0.19

(1) – Aggregate intrinsic value based on closing common stock price of $0.20 at March 31, 2023.

The options granted to purchase 1,320,498 shares during the three months ended March 31, 2023 with an aggregate fair value of $248,000 were issued to an officer, board of directors, employees and a consultant:  (i) we issued options to purchase 347,730 shares of our common stock at an exercise price on the respective grant date of $0.20 per share to members of our board of directors for services performed, in lieu of cash; the fair value of these options totaled $65,000; (ii) we issued options to purchase 570,204 shares of our common stock to employees as part of an employee retention plan at an exercise price on the respective date of $0.20 per share; the fair value of employee retention plan options totaled $108,000 and will vest quarterly over four years as long as they are retained as employees; (iii) we issued options to purchase 102,564 shares of our common stock to consultants in lieu of cash for expiring options at $0.20 per share totaling $19,000, and (iv) we issued 300,000 options to our Chief Financial Officer with a fair value of $56,000 (see “Chief Financial Officer Contract Extension” immediately below). All stock option expense is recorded on our consolidated statement of operations as selling, general and administrative expense.

The options granted to purchase 2,621,229 shares during the three months ended  March 31, 2022 with an aggregate fair value of $564,000 were issued to officers, board of directors, employees and consultants: (i) we issued an option to purchase 39,848 shares of our common stock at an exercise price on the respective grant date of $0.23 per share to our CFO and President to replace options that had expired; the fair value of this option was $9,000; (ii) we issued options to purchase 444,092 shares of our common stock at an exercise price on the respective grant date of $0.23 per share to members of our board of directors for services performed, in lieu of cash; the fair value of these options totaled $96,000; (iii) we issued options to purchase 1,690,257 shares of our common stock to employees as part of an employee retention plan at an exercise price on the respective date of $0.23 per share; the fair value of employee retention plan options totaled $362,000 and will vest quarterly over four years as long as they are retained as employees; and (iv) we issued options to purchase 447,032 shares of our common stock to consultants in lieu of cash for expiring options and per agreement totaling $97,000. All stock option expense is recorded on our consolidated statement of operations as selling, general and administrative expense.

Chief Financial Officer Contract Extension

On March 21, 2023, we and our Chief Financial Officer Charles K. Dargan, II formally agreed to extend the engagement agreement dated February 1, 2008 (the “Engagement Agreement”, which had been previously extended multiple times), pursuant to which Mr. Dargan has been and continues to serve as the Company’s Chief Financial Officer. The Engagement Extension Agreement dated as of March 21, 2023 (the “Engagement Extension Agreement”) provides for an additional one-year term to expire January 31, 2024 (the “Extended Term”), at which time Mr. Dargan will continue to serve as CFO, unless and until either party terminates the agreement.

As the sole compensation for the Extended Term, Mr. Dargan was issued an option (“Option”) to purchase 25,000 shares of the Company’s common stock for each month during the Extended Term (thus, an option to purchase 300,000 shares reflecting an extended term of 12 months). The Option vests over the period of the Extended Term, with 25,000 shares having vested as of March 21, 2023, and the remaining shares to vest 25,000 shares monthly beginning March 31, 2023, and each month thereafter, so long as the agreement is in full force and effect. The Option is exercisable at $0.20 per share, the closing price of BioLargo’s common stock on the March 21, 2023 grant date, expires ten years from the grant date, and was issued pursuant to the Company’s 2018 Equity Incentive Plan.

The Option is Mr. Dargan’s sole compensation for the Extended Term. As was the case in all prior terms of his engagement, there is no cash component of his compensation for the Extended Term. Mr. Dargan is eligible to be reimbursed for business expenses he incurs in connection with the performance of his services as the Company’s Chief Financial Officer (although he has made no such requests for reimbursement in the past). All other provisions of the Engagement Agreement not expressly amended pursuant to the Engagement Extension Agreement remain the same, including provisions regarding indemnification and arbitration of disputes.

2007 Equity Incentive Plan

On September 7, 2007, and as amended April 29, 2011, the BioLargo, Inc. 2007 Equity Incentive Plan (“2007 Plan”) was adopted as a means of providing our directors, key employees and consultants additional incentive to provide services. Both stock options and stock grants may be made under this plan for a period of 10 years, which expired on September 7, 2017. The Board’s Compensation Committee administers this plan. As plan administrator, the Compensation Committee has sole discretion to set the price of the options. As of September 2017, the Plan was closed to further stock option grants.

Activity for our stock options under the 2007 Plan for the three months ended March 31, 2023, and 2022 is as follows:

						Weighted
						Average		Aggregate
	Options		Exercise			Price per		intrinsic
	Outstanding		price per share			share		Value(1)
Balance, December 31, 2022		1,904,085	$0.28	–	0.69	$	0.56
Expired		–		–			–
Balance, March 31, 2023		1,904,085	$0.28	–	0.69	$	0.56	$	–
Balance, December 31, 2021		2,879,246	$0.23	–	0.94	$	0.49
Expired		–		–			–
Balance, March 31, 2022		2,879,246	$0.23	–	0.94	$	0.49

⁽¹⁾ – Aggregate intrinsic value based on closing common stock price of $0.20 at March 31, 2023.

Non-Plan Options issued

Activity of our non-plan stock options issued for the three months ended March 31, 2023 and 2022 is as follows:

							Weighted
	Non-plan						average		Aggregate
	Options			Exercise			price per		intrinsic
	outstanding			price per share			share		value(1)
Balance, December 31, 2022		19,023,829		$0.12	–	0.83	$	0.39
Granted		48,804			0.20			0.20
Balance, March 31, 2023		19,072,633		$0.12	–	0.83	$	0.39
Unvested		(507,500	)		0.45			0.45
Vested, March 31, 2023		18,565,133		$0.12	–	0.83	$	0.38	$	88,000
Balance, December 31, 2021		20,119,207		$0.12	–	0.83	$	0.39
Granted		32,609			0.23			0.23
Balance, March 31, 2022		20,151,816		$0.12	–	0.83	$	0.39

(1) – Aggregate intrinsic value based on closing common stock price of $0.20 at March 31, 2023.

During the three months ended March 31, 2023, we issued options to purchase an aggregate 48,804 shares of our common stock at $0.20 per share to vendors for fees for services. The fair value of the options issued totaled an aggregate $9,000 and is recorded in our selling, general and administrative expense.

During the three months ended March 31, 2022, we issued options to purchase an aggregate 32,609 shares of our common stock at $0.23 per share to vendors for fees for services. The fair value of the options issued totaled an aggregate $7,000 and is recorded in our selling, general and administrative expense.

XML

Note 6 - Warrants

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Warrants [Text Block]

Note 6. Warrants

We have certain warrants outstanding to purchase our common stock, at various prices, as described in the following table:

							Weighted
							average		Aggregate
	Warrants			Exercise			price per		intrinsic
	outstanding			price per share			share		value(1)
Balance, December 31, 2022		49,023,398		$0.13	–	1.00	$	0.26
Granted		7,512,000		0.21	–	0.29		0.25
Expired		(4,684,986	)	0.19	–	0.35		0.21
Balance, March 31, 2023		51,850,412		$0.13	–	1.00	$	0.26	$	122,000
Balance, December 31, 2021		36,765,562		$0.16	–	1.00	$	0.27
Granted		10,393,936		0.20	–	0.25		0.22
Expired		(388,889	)		0.22			0.22
Balance, March 31, 2022		46,770,549		$0.14	–	1.00	$	0.29

(1) – Aggregate intrinsic value based on closing common stock price of $0.20 at March 31, 2023.

Warrants issued in Unit Offerings

During the three months ended March 31, 2023, pursuant to our Unit Offerings (see Note 3), we issued six-month stock purchase warrants to purchase an aggregate 3,656,000 shares of our common stock at $0.228 per share, and five-year stock purchase warrants to purchase an aggregate 3,656,000 shares of our common stock at $0.285 per share.

During the three months ended March 31, 2022, pursuant to our 2020 Unit Offering (see Note 3), we issued six-month stock purchase warrants to purchase an aggregate 5,196,968 shares of our common stock at $0.204 per share, and five-year stock purchase warrants to purchase an aggregate 5,196,968 shares of our common stock at $0.25 per share.

Warrant issued in conjunction with amendment to note payable

On March 6, 2023, we entered into an agreement with the holder of a $50,000 note (see Note 4, “Convertible note payable, matures March 1, 2023”) to convert that note into common stock of BETI. As payment for interest, a warrant to purchase 200,000 shares of BioLargo common stock at $0.21 was issued to the investor, expiring five years from the grant date. The fair value of this warrant totaled $30,000 and was recorded as interest expense on our statement of operations.

Fair Value – Interest Expense

To determine interest expense related to our outstanding warrants issued in conjunction with debt offerings, the fair value of each award grant is estimated on the date of grant using the Black-Scholes option pricing model and the relative fair values are amortized over the life of the warrant. For the determination of expense of warrants issued for services, extinguishment of debt and settlement management also uses the option-pricing model. The principal assumptions we used in applying this model were as follows:

	2023			2022
Risk free interest rate	3.88	–	4.27%	3.69	–	3.88%
Expected volatility	40	–	95%		40%
Expected dividend yield		—			—
Forfeiture rate		—			—
Expected life in years	3	–	5		3

The risk-free interest rate is based on U.S. Treasury yields in effect at the time of grant. Expected volatilities are based on historical volatility of our common stock. The expected life in years is based on the contract term of the warrant.

XML

Note 7 - Accounts Payable and Accrued Expenses

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Accounts Payable and Accrued Liabilities Disclosure [Text Block]

Note 7. Accounts Payable and Accrued Expenses

As of March 31, 2023, accounts payable and accrued expenses included the following (in thousands):

Category	BioLargo		ONM		BLEST		Water		Intercompany amounts			Totals
Accounts payable	$	169	$	794	$	37	$	121	$	(82	)	$	1,039
Accrued payroll		36		49		75		—		—			160
Accrued interest		25		—		—		—		—			25
Total												$	1,224

As of December 31, 2022, accounts payable and accrued expenses included the following (in thousands):

Category	BioLargo		ONM		BLEST		Water		Intercompany amounts			Totals
Accounts payable	$	187	$	486	$	7	$	119	$	(82	)	$	717
Accrued payroll		20		58		120		—		—			198
Accrued interest		25		—		—		—		—			25
Total												$	940

See Note 8, “Accounts Payable and Accrued Expenses”, for the accounts payable and accrued expenses of Clyra Medical.

XML

Note 8 - Noncontrolling Interest - Clyra Medical

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Noncontrolling Interest Disclosure [Text Block]

Note 8. Noncontrolling Interest – Clyra Medical

As discussed in Note 2 above, we consolidate the operations of our partially owned subsidiary Clyra Medical, of which we owned 58% of its outstanding shares as of March 31, 2023.

Debt Obligations of Clyra Medical

Promissory Note

On  April 8, 2022, Clyra Medical issued a promissory note in the principal amount of $100,000 to an individual investor, payable  April 8, 2024, and bearing 8% annual interest. The note  may be converted by its holder at any time prior to the maturity date, and automatically converts to stock upon (i) Clyra’s sale of $5,000,000 or more of its common or preferred stock, or (ii) the maturity date, at a conversion price equal to 70% of the lowest price-per-share of shares sold to a future investor prior to the maturity date.

Line of Credit

On June 30, 2020, Clyra Medical entered into a Revolving Line of Credit Agreement whereby Vernal Bay Capital Group, LLC committed to provide a $1,000,000 inventory line of credit. Clyra Medical received $260,000 in draws and made repayments totaling $113,000. Funds from the line of credit must be used to produce inventory. Additional draws are conditional upon the presentation of invoices or purchase orders to the lender equal to the greater of one-half of principal outstanding on the line of credit, and $200,000. The line of credit note earns interest at 15%, matures in one year, and requires Clyra pay interest and principal from gross product sales. For the first 6 months, Clyra is required to pay 30% of gross product sales to reduce amounts owed, and thereafter 60% of gross sales. Clyra issued Vernal Bay 322 shares of its common stock as a commitment fee for the line of credit, valued at $70,000. A security agreement of the same date grants Vernal Bay a security interest in Clyra’s inventory, as that term is defined in the Uniform Commercial Code. Clyra may prepay the note at any time.

On December 13, 2022, we entered into an amendment of the Revolving Line of Credit Agreement whereby the maturity date of the line of credit was extended to September 30, 2024, and the payment terms were modified such that amounts of principal due in each month are capped at a maximum of 15% of the principal amount then due under the note. Additionally, BioLargo agreed to allow Vernal Bay to elect to convert, any time prior to the note’s maturity date, the 322 shares of Clyra common stock it received as consideration for the line of credit into shares of Biolargo common stock at the then market price of BioLargo’s common stock. Vernal Bay elected to convert Clyra shares to 527,983 BioLargo shares of common stock.

As of March 31, 2023, the balance outstanding on this line of credit totals $147,000. As of December 31, 2022, the balance outstanding on this line of credit totaled $161,000.

Equity Transactions

As of December 31, 2022, Clyra had 91,149 common shares, and 2,800 Series A Preferred shares, outstanding. Of that amount, BioLargo owned 51,571 common shares, and 1,352 Series A Preferred shares. As of March 31, 2023, BioLargo owns 58% of Clyra’s issued and outstanding shares.

Sales of Common Stock

During the three months ended March 31, 2023, Clyra did not sell shares of its common stock. On March 2, 2022, BioLargo converted $633,091 owed to it by Clyra into 2,032 shares of Clyra common stock.

Sales of Series A Preferred Stock

During the three months ended March 31, 2023, Clyra sold 725 shares of its Series A Preferred Stock, and in exchange received $225,000 in gross and net proceeds. On December 20, 2022, Clyra sold 725 shares of its Series A Preferred Stock, and in exchange received $225,000 in gross and net proceeds, from two accredited investors. Purchasers of the Series A Preferred Stock also received a 3-year warrant to purchase the same number of additional shares of common stock for $372 per share. The fair value of the warrants issued totaled $110,000. Shares of Series A Preferred Stock earn a dividend of 15% each year, compounding annually; the company is under no obligation to pay such dividends in cash, and such dividends automatically convert to common stock upon conversion of the Series A Preferred Stock to common stock. Each share of Series A Preferred stock can be converted by the holder at any time for one share of common stock, and automatically convert upon the completion of a public offering of shares in which at least $5,000,000 of gross proceeds is received by the company. Accrued dividends may be converted to common stock at a conversion rate of $310 per share.

Each investor also entered into an agreement with BioLargo whereby the investor may exchange some or all of its Series A Preferred stock, plus accrued dividends, into shares of BioLargo common stock, at a price equal to a 20% discount of the volume weighted average price over the 30 prior trading days. Elections must be made during the 18-month period that begins 18 months after the closing of the Series A Preferred offering (which has not yet taken place), or June 30, 2023, whichever is earlier.

Clyra Stock Options

						Weighted
		Clyra				average
	Options		Exercise			price per
	Outstanding		price per share			share
Balance, December 31, 2022		15,833	$1.00	-	310	$	5.53
Granted		426	1.00	-	271		148.27
Balance, March 31, 2023		16,259	$1.00	-	310	$	9.27
Balance, December 31, 2021		14,004	$		1.00	$	1.00
Granted		648			1.00		1.00
Balance, March 31, 2022		14,652	$		1.00	$	1.00

Clyra issues options to its employees and consultants in lieu of compensation owed on a regular basis.  The fair value of the options issued in the three months ended March 31, 2023, and 2022 totaled $61,000 and $141,000, respectively. We used the Black-Scholes model to calculate the initial fair value, assuming a stock price on date of grant of $310 per share. Because Clyra is a private company with no secondary market for its common stock, the resulting fair value was discounted by 30%.

	March 31, 2023			December 31, 2022
Risk free interest rate	3.88	–	4.27%		2.32	%
Expected volatility		40%			40	%
Expected dividend yield		—			—
Forfeiture rate		—			—
Expected life in years		10			10

Accounts Payable and Accrued Expenses

At March 31, 2023, and December 31, 2022, Clyra had the following accounts payable and accrued expenses (in thousands):

Category	2023		2022
Accounts payable	$	235	$	186
Accrued payroll		6		45
Accrued interest		8		7
Accrued dividend		29		---
Total	$	278	$	238

The accrued dividend relates to the Series A Preferred Stock. Clyra is not required to pay accrued dividends in cash. The holder of Series A Preferred Stock may convert accrued dividends to common stock at any time. Any accrued dividends automatically convert to Clyra common stock upon conversion of the Series A Preferred Stock.

XML

Note 9 - BioLargo Engineering, Science and Technologies, LLC

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Wholly-Owned Subsidiary [Text Block]

Note 9. BioLargo Engineering, Science and Technologies, LLC

In September 2017, we commenced a full-service environmental engineering firm and formed a Tennessee entity named BioLargo Engineering, Science & Technologies, LLC (“BLEST”). In conjunction with the start of this subsidiary we entered into employment agreements with six scientists and engineers. (See Note 11 “Business Segment Information”.) BLEST was capitalized with two classes of membership units: Class A, 100% owned by BioLargo, and Class B, held by management of BLEST, and which initially have no “profit interest,” as that term is defined in Tennessee law. However, over the succeeding five years, the Class B members can earn up to a 30% profit interest. They also have been granted options to purchase up to an aggregate 1,750,000 shares of BioLargo, Inc. common stock. The profit interest and option shares are subject to a five year vesting schedule tied to the performance of the subsidiary, including gross revenue targets that increase over time, obtaining positive cash flow by March 31, 2018 (which was not met), collecting 90% of its account receivables, obtaining a profit of 10% in its first year (and increasing in subsequent years) (which was not met), making progress in the scale-up and commercialization of our AOS system, and using BioLargo research scientists (such as our Canadian team) for billable work on client projects. These criteria are to be evaluated annually by BLEST’s compensation committee (which includes BioLargo’s president, CFO, and BLEST’s president), beginning September 2018. Given the significant performance criteria, the Class B units and the stock options will only be recognized in compensation expense if or when the criteria are satisfied.

The BLEST Compensation Committee has met regularly since the subsidiary commenced operations. In 2018, it reviewed the operating performance and determined that the performance metrics were not met and as a result, did not award any Class B units or stock options. In November 2019, it determined that a portion of the performance metrics were met, and that one-half of the eligible profits interests would be vested (2.5% in the aggregate), and therefore one-half of the option interests (10%) would be vested (175,000 options shares in the aggregate). The vesting of option shares resulted in a fair value totaling $44,000, recorded on our consolidated statement of operations as selling, general and administrative expense. The fair value of the profit interest was nominal and not booked. In January 2021, the committee again reviewed the operating performance and determined that a portion of the performance metrics were met. It was agreed that one-half and one-quarter of the eligible profit interests would be vested (3.75% in the aggregate), and therefore one-half of the option interests (15%) would be vested (262,500 options shares in the aggregate). The vesting of option shares resulted in a fair value totaling $65,000, recorded on our consolidated statement of operations as selling, general and administrative expense for the year ended December 31, 2020. In January 2022, the committee again reviewed the operating performance and determined that a portion of the performance metrics were met. It was agreed that an additional one-half and one-quarter of the eligible profits interests would be vested (11.25% in the aggregate), and therefore an additional half of the option interests would be vested (525,000 options shares in the aggregate). The vesting of option shares resulted in a fair value totaling $65,000, recorded on our consolidated statement of operations as selling, general and administrative expense for the year ended December 31, 2021. In December 2022, the committee again reviewed the operating performance and determined that a portion of the performance metrics were met. It was agreed that an additional one-half and one-quarter of the eligible profits interests would be vested (17.75% in the aggregate), and therefore an additional half of the option interests would be vested (1,242,500 options shares in the aggregate). The vesting of option shares resulted in a fair value totaling $135,000 and is recorded on our consolidated statement of operations as selling, general and administrative expense for the year ended December 31, 2022.

At March 31, 2023, BioLargo owns 82.25% of BLEST.

XML

Note 10 - BioLargo Energy Technologies, Inc.

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Noncontrolling Interest Disclosure [Text Block]

Note 8. Noncontrolling Interest – Clyra Medical

As discussed in Note 2 above, we consolidate the operations of our partially owned subsidiary Clyra Medical, of which we owned 58% of its outstanding shares as of March 31, 2023.

Debt Obligations of Clyra Medical

Promissory Note

On  April 8, 2022, Clyra Medical issued a promissory note in the principal amount of $100,000 to an individual investor, payable  April 8, 2024, and bearing 8% annual interest. The note  may be converted by its holder at any time prior to the maturity date, and automatically converts to stock upon (i) Clyra’s sale of $5,000,000 or more of its common or preferred stock, or (ii) the maturity date, at a conversion price equal to 70% of the lowest price-per-share of shares sold to a future investor prior to the maturity date.

Line of Credit

On June 30, 2020, Clyra Medical entered into a Revolving Line of Credit Agreement whereby Vernal Bay Capital Group, LLC committed to provide a $1,000,000 inventory line of credit. Clyra Medical received $260,000 in draws and made repayments totaling $113,000. Funds from the line of credit must be used to produce inventory. Additional draws are conditional upon the presentation of invoices or purchase orders to the lender equal to the greater of one-half of principal outstanding on the line of credit, and $200,000. The line of credit note earns interest at 15%, matures in one year, and requires Clyra pay interest and principal from gross product sales. For the first 6 months, Clyra is required to pay 30% of gross product sales to reduce amounts owed, and thereafter 60% of gross sales. Clyra issued Vernal Bay 322 shares of its common stock as a commitment fee for the line of credit, valued at $70,000. A security agreement of the same date grants Vernal Bay a security interest in Clyra’s inventory, as that term is defined in the Uniform Commercial Code. Clyra may prepay the note at any time.

On December 13, 2022, we entered into an amendment of the Revolving Line of Credit Agreement whereby the maturity date of the line of credit was extended to September 30, 2024, and the payment terms were modified such that amounts of principal due in each month are capped at a maximum of 15% of the principal amount then due under the note. Additionally, BioLargo agreed to allow Vernal Bay to elect to convert, any time prior to the note’s maturity date, the 322 shares of Clyra common stock it received as consideration for the line of credit into shares of Biolargo common stock at the then market price of BioLargo’s common stock. Vernal Bay elected to convert Clyra shares to 527,983 BioLargo shares of common stock.

As of March 31, 2023, the balance outstanding on this line of credit totals $147,000. As of December 31, 2022, the balance outstanding on this line of credit totaled $161,000.

Equity Transactions

As of December 31, 2022, Clyra had 91,149 common shares, and 2,800 Series A Preferred shares, outstanding. Of that amount, BioLargo owned 51,571 common shares, and 1,352 Series A Preferred shares. As of March 31, 2023, BioLargo owns 58% of Clyra’s issued and outstanding shares.

Sales of Common Stock

During the three months ended March 31, 2023, Clyra did not sell shares of its common stock. On March 2, 2022, BioLargo converted $633,091 owed to it by Clyra into 2,032 shares of Clyra common stock.

Sales of Series A Preferred Stock

During the three months ended March 31, 2023, Clyra sold 725 shares of its Series A Preferred Stock, and in exchange received $225,000 in gross and net proceeds. On December 20, 2022, Clyra sold 725 shares of its Series A Preferred Stock, and in exchange received $225,000 in gross and net proceeds, from two accredited investors. Purchasers of the Series A Preferred Stock also received a 3-year warrant to purchase the same number of additional shares of common stock for $372 per share. The fair value of the warrants issued totaled $110,000. Shares of Series A Preferred Stock earn a dividend of 15% each year, compounding annually; the company is under no obligation to pay such dividends in cash, and such dividends automatically convert to common stock upon conversion of the Series A Preferred Stock to common stock. Each share of Series A Preferred stock can be converted by the holder at any time for one share of common stock, and automatically convert upon the completion of a public offering of shares in which at least $5,000,000 of gross proceeds is received by the company. Accrued dividends may be converted to common stock at a conversion rate of $310 per share.

Each investor also entered into an agreement with BioLargo whereby the investor may exchange some or all of its Series A Preferred stock, plus accrued dividends, into shares of BioLargo common stock, at a price equal to a 20% discount of the volume weighted average price over the 30 prior trading days. Elections must be made during the 18-month period that begins 18 months after the closing of the Series A Preferred offering (which has not yet taken place), or June 30, 2023, whichever is earlier.

Clyra Stock Options

						Weighted
		Clyra				average
	Options		Exercise			price per
	Outstanding		price per share			share
Balance, December 31, 2022		15,833	$1.00	-	310	$	5.53
Granted		426	1.00	-	271		148.27
Balance, March 31, 2023		16,259	$1.00	-	310	$	9.27
Balance, December 31, 2021		14,004	$		1.00	$	1.00
Granted		648			1.00		1.00
Balance, March 31, 2022		14,652	$		1.00	$	1.00

Clyra issues options to its employees and consultants in lieu of compensation owed on a regular basis.  The fair value of the options issued in the three months ended March 31, 2023, and 2022 totaled $61,000 and $141,000, respectively. We used the Black-Scholes model to calculate the initial fair value, assuming a stock price on date of grant of $310 per share. Because Clyra is a private company with no secondary market for its common stock, the resulting fair value was discounted by 30%.

	March 31, 2023			December 31, 2022
Risk free interest rate	3.88	–	4.27%		2.32	%
Expected volatility		40%			40	%
Expected dividend yield		—			—
Forfeiture rate		—			—
Expected life in years		10			10

Accounts Payable and Accrued Expenses

At March 31, 2023, and December 31, 2022, Clyra had the following accounts payable and accrued expenses (in thousands):

Category	2023		2022
Accounts payable	$	235	$	186
Accrued payroll		6		45
Accrued interest		8		7
Accrued dividend		29		---
Total	$	278	$	238

The accrued dividend relates to the Series A Preferred Stock. Clyra is not required to pay accrued dividends in cash. The holder of Series A Preferred Stock may convert accrued dividends to common stock at any time. Any accrued dividends automatically convert to Clyra common stock upon conversion of the Series A Preferred Stock.

BioLargo Energy Technologies, Inc (BETI) [Member]

Notes to Financial Statements

Noncontrolling Interest Disclosure [Text Block]

Note 10. BioLargo Energy Technologies, Inc.

Subsidiary BioLargo Energy Technologies, Inc. (“BETI”) was formed for the purpose of commercializing a sodium-sulfur battery technology.

During the three months ended March 31, 2023, BETI sold 325,000 shares of its common stock to six accredited investors for $2.00 per share. Of that amount, BioLargo purchased 50,000 shares for $100,000, and one investor converted a $50,000 note owed by BioLargo into 25,000 shares. Net proceeds from third parties totaled $550,000.

Each investor also entered into an agreement with BioLargo whereby the investor may exchange some or all of its shares of BETI common stock into shares of BioLargo common stock, at a price equal to a 20% discount of the volume weighted average price over the 20 trading days prior to the election to exchange. Elections must be made during calendar year 2024.

As of March 31, 2023, there are 9,325,000 shares outstanding, of which BioLargo holds 9,050,000.

XML

Note 11 - Business Segment Information

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

Note 11. Business Segment Information

BioLargo currently has four operating business segments, plus its corporate entity which is responsible for general corporate operations, including administrative functions, finance, human resources, marketing, legal, etc. The four operational business segments are:

1. ONM Environmental -- which sells odor and volatile organic control products and services (located in Westminster, California);

2. Clyra Medical Technologies (“Clyra Medical”) -- which develops and sells medical products based on our technologies;

3. BLEST -- which provides professional engineering services on a time and materials basis for outside clients and supports our internal operations as needed (located in Oak Ridge, Tennessee); and

4. BioLargo Water (“Water”) -- which historically focused entirely on R&D, and has now shifted its focus to commercializing the AOS technology (located in Edmonton, Alberta Canada).

5. BioLargo Energy Technologies, Inc. (“BETI”) – formed to commercialize a sodium-sulfur battery technology.

Other than ONM Environmental during the last three quarterly periods, none of our operating business units have operated at a profit,  and therefore each required additional cash to meet its monthly expenses, funded through BioLargo’s sales of debt or equity, research grants, and tax credits. BETI and Clyra Medical have also been funded by third party investors who invest directly in exchange for equity ownership in that entity.  

The segment information for the three months ended March 31, 2023, and 2022, is as follows (in thousands):

March 31, 2023	BioLargo			ONM			Clyra			BLEST			Water			BETI			Elimination			Total
Revenue	$	—		$	3,543		$	6		$	363		$	—		$	—		$	(170	)	$	3,742
Intersegment revenue		—			—			—			(170	)		—			—			170			—
R&D expense		(189	)		—			(134	)		(245	)		(135	)		(32	)		170			(565	)
Operating income (loss)		(799	)		1,387			(426	)		(368	)		(184	)		(87	)		—			(477	)
Grant income		—			—			—			—			31			—			—			31
Interest expense		(36	)		(2	)		(10	)		—			—			—			—			(48	)
Net income (loss)		(835	)		1,385			(436	)		(368	)		(153	)		(87	)		—			(494	)

March 31, 2022	BioLargo			ONM			Clyra			BLEST			Water			Elimination			Total
Revenue	$	2		$	600		$	10		$	545		$	—		$	(188	)	$	965
Intersegment revenue		(2	)		(2	)		—			(188	)		—			192			—
Research and development		(265	)		—			(16	)		(108	)		(197	)		194			(392	)
Operating loss		(1,220	)		13			(240	)		(35	)		(228	)		—			(1,710	)
Grant income		—			—			—			—			5			—			5
Interest expense		(6	)		—			(7	)		—			—			—			(13	)
Net income (loss)		(1,226	)		187			(247	)		(35	)		(223	)		—			(1,544	)

As of March 31, 2023	BioLargo		ONM		Clyra		BLEST		Water		BETI		Elimination			Total
Tangible assets	$	530	$	3,392	$	578	$	505	$	223	$	628	$	(73	)	$	5,783
Right of use (leased assets)		114		—		—		723		—				—			837
Investment in South Korean joint venture		27		—		—		—		—				—			27
Total	$	671	$	3,392	$	578	$	1,228	$	223	$	628	$	(73	)	$	6,647

As of December 31, 2022	BioLargo		ONM		Clyra		BLEST		Water		Elimination			Total
Tangible assets	$	669	$	2,064	$	631	$	441	$	194	$	(41	)	$	3,958
Right of use (leased assets)		136		—		—		731		—		—			867
Investment in South Korean joint venture		33		—		—		—		—		—			33
Total	$	838	$	2,064	$	631	$	1,172	$	194	$	(41	)	$	4,858

XML

Note 12 - Commitments and Contingencies

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Commitments and Contingencies Disclosure [Text Block]

Note 12. 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. Short-term leases less than one-year are not included in our analysis. For the three months ended March 31, 2023, and 2022, rental expense was $83,000 and $63,000. The lease of our Westminster facility expires  August 2024. Management has not yet determined whether it will exercise its option to extend the lease four years; therefore the four-year extension is not included in the analysis. In  September 2022, the lease of our Oak Ridge, Tennessee facility was extended for ten years. 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. The leases have no additional payment terms such as common area maintenance payments, tax sharing payments or other allocable expenses. Likewise, the leases do not contain other terms and conditions of use, such as variable lease payments, residual value guaranties or other restrictive financial terms. Since there is no explicit interest rate in our leases, management used its incremental borrowing rate, which is estimated to be 18% to determine lease liability.  

XML

Note 13 - Subsequent Events

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Subsequent Events [Text Block]

Note 13. Subsequent Events.

Management has evaluated subsequent events through the date of the filing of this quarterly report and management noted the following for disclosure.

Lincoln Park Capital Purchase of Shares

From April 1, 2023, through May 12, 2023, we sold 567,713 shares of common stock to Lincoln Park pursuant to the 2022 LPC Purchase Agreement (see Note 3) and received $101,000 in gross and net proceeds. These sales were registered with the SEC on Form S-1 (file number 333-268973).

Clyra Medical – Series A Preferred

From April 1, 2023, through May 12, 2023, Clyra Medical sold 401 shares of its Series A Preferred Stock, and in exchange received $124,000 in gross and net proceeds. Purchasers of the Series A Preferred Stock also received a 3-year warrant to purchase the same number of additional shares of common stock for $372 per share. Each investor also entered into an agreement with BioLargo whereby the investor may exchange some or all of its Series A Preferred stock, plus accrued dividends, into shares of BioLargo common stock, at a price equal to a 20% discount of the volume weighted average price over the 30 prior trading days. (See Note 8, “Sales of Series A Preferred Stock”.)

XML

Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2023

Accounting Policies [Abstract]

Consolidation, Policy [Policy Text Block]

Principles of Consolidation

The consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries, and partially owned subsidiaries BETI, BLEST and Clyra Medical. All intercompany accounts and transactions have been eliminated.

Foreign Currency Transactions and Translations Policy [Policy Text Block]

Foreign Currency

The Company has designated the functional currency of BioLargo Water, Inc., our Canadian subsidiary, to be the Canadian dollar. Therefore, translation gains and losses resulting from differences in exchange rates are recorded in accumulated other comprehensive income.

Cash and Cash Equivalents, Policy [Policy Text Block]

Cash and Cash Equivalents

The Company considers all highly liquid investments with maturities of three months or less when acquired to be cash equivalents. Substantially all cash equivalents are held in short-term money market accounts at one of the largest financial institutions in the United States, Bank of America. From time to time, our cash account balances are greater than the Federal Deposit Insurance Corporation insurance limit of $250,000 per owner per bank, and during such times, we are exposed to credit loss for amounts in excess of insured limits in the event of non-performance by the financial institution. We do not anticipate non-performance by our financial institution.

As of March 31, 2023, and December 31, 2022, our cash balances were made up of the following (in thousands):

	March 31, 2023		December 31, 2022
BioLargo, Inc. and subsidiaries	$	3,171	$	1,685
Clyra Medical Technologies, Inc.		93		166
Total	$	3,264	$	1,851

Receivable [Policy Text Block]

Accounts Receivable

Trade accounts receivable are recorded net of allowances for doubtful accounts. Estimates for allowances for doubtful accounts are determined based on payment history and individual customer circumstances. The allowance for doubtful accounts as of March 31, 2023, and  December 31, 2022 was $12,000.

Concentration Risk, Credit Risk, Policy [Policy Text Block]

Credit Concentration

We have a limited number of customers that account for significant portions of our revenue. During the three months ended March 31, 2023, one customer accounted for more than 10% of consolidated revenues, and during the three months ended March 31, 2022, two customers each accounted for more than 10% of consolidated revenues:

	March 31, 2023			March 31, 2022
Customer A		86	%		29	%
Customer B	<10		%		14	%

At March 31, 2023, and December 31, 2022, one customer accounted for more than 10% of consolidated accounts receivable:

	March 31, 2023			December 31, 2022
Customer A		70	%		24	%

Inventory, Policy [Policy Text Block]

Inventory

Inventories are stated at the lower of cost or net realizable value using the average cost method. The allowance for obsolete inventory as of  March 31, 2023, and December 31, 2022, was $158,000. Inventories consisted of (in thousands):

	March 31, 2023		December 31, 2022
Raw material	$	52	$	46
Finished goods		83		74
Total	$	135	$	120

Other Assets, Policy [Policy Text Block]

Other Non-Current Assets

Other non-current assets consisted of (i) security deposits related to our business offices, (ii) three patents acquired on  October 22, 2021, for $34,000, and (iii) tax credit receivables from the Canadian government related to a research and development credit from our Canadian subsidiary for which we’ve applied for and received in prior periods.

	March 31, 2023		December 31, 2022
Patents	$	34	$	34
Security deposits		36		36
Tax credit receivable		54		54
Total	$	124	$	124

Equity Method Investments [Policy Text Block]

Equity Method of Accounting

On March 20, 2020, we invested $100,000 into a South Korean entity (Odin Co. Ltd., “Odin”) pursuant to a Joint Venture agreement we had entered into with BKT Co. Ltd. and its U.S. based subsidiary, Tomorrow Water. We received a 40% non-dilutive equity interest, and BKT and Tomorrow Water each received 30% equity interests for an aggregate $150,000 investment.

We account for our investment in the joint venture under the equity method of accounting. We have determined that while we have significant influence over the joint venture through our technology license and our position on the Board of Directors, we do not control the joint venture or are otherwise involved in managing the entity and we own less than a majority of the equity. Therefore, we record the asset on our consolidated balance sheet and record an increase or decrease the recorded balance by our percentage ownership of the profits or losses in the joint venture. The joint venture has incurred a loss since inception and our 40% ownership share reduced our investment interest during the three months ended March 31, 2023, and 2022, by $6,000 and $8,000, respectively.

Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block]

Impairment

Long-lived and definite lived intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If the sum of the expected future undiscounted cash flows from the use of the asset and its eventual disposition is less than the carrying amount of the asset, then an impairment loss is recognized. The impairment loss is measured based on the fair value of the asset. Any resulting impairment is recorded as a reduction in the carrying value of the related asset in excess of fair value and a charge to operating results.

Earnings Per Share, Policy [Policy Text Block]

Earnings (Loss) Per Share

We report basic and diluted earnings (loss) per share (“EPS”) for common and common share equivalents. Basic EPS is computed by dividing reported earnings by the weighted average shares outstanding. Diluted EPS is computed by adding to the weighted average shares the dilutive effect if convertible notes payable, stock options and warrants were exercised into common stock. For the three months ended March 31, 2023, and 2022, the denominator in the diluted EPS computation is the same as the denominator for basic EPS due to the Company’s net loss which creates an anti-dilutive effect of the convertible notes payable, warrants and stock options.

Use of Estimates, Policy [Policy Text Block]

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and revenues and expenses during the period reported. Actual results could differ from those estimates. Estimates are used when accounting for stock-based transactions, debt transactions, derivative liabilities, allowance for bad debt, asset depreciation and amortization, impairment expense, among others.

The methods, estimates and judgments we use in applying these most critical accounting policies have a significant impact on the results of our financial statements.

Share-Based Payment Arrangement [Policy Text Block]

Share-Based Compensation Expense

We recognize compensation expense for stock option awards on a straight-line basis over the applicable service period of the award, which is the vesting period. Fair value is determined on the grant date. Share-based compensation expense is based on the grant date fair value estimated using the Black-Scholes Option Pricing Model.

For stock and stock options issued to consultants and other non-employees for services, the Company measures and records an expense as of the earlier of the date at which either: a commitment for performance by the non-employee has been reached or the non-employee’s performance is complete. The equity instruments are measured at the current fair value, and for stock options, the instruments are measured at fair value using the Black Scholes option model.

The following methodology and assumptions were used to calculate share-based compensation for the three months ended March 31, 2023, and 2022:

	2023						2022
	Non Plan			2018 Plan			Non Plan			2018 Plan
Risk free interest rate		3.48	%		3.48	%	2.32	–	3.83%	2.32	–	3.83%
Expected volatility		114	%		114	%	114	–	117%	114	–	117%
Expected dividend yield		—			—			—			—
Forfeiture rate		—			—			—			—
Life in years		10			10			10			10

Expected price volatility is the measure by which our stock price is expected to fluctuate during the expected term of an option. The expected volatility is derived from the historical daily change in the market price of our common stock, as we believe that historical volatility is the best indicator of future volatility.

The risk-free interest rate used in the Black-Scholes calculation is based on the prevailing U.S. Treasury yield as determined by the U.S. Federal Reserve. We have never paid any cash dividends on our common stock and do not anticipate paying cash dividends on our common stock in the foreseeable future.

Warrant Policy [Policy Text Block]

Warrants

Warrants issued with our convertible and non-convertible debt instruments are accounted for under the fair value and relative fair value method.

The warrant is first analyzed per its terms as to whether it has derivative features or not. If the warrant is determined to be a derivative and not qualify for equity treatment, then it is measured at fair value using the Black Scholes option model and recorded as a liability on the balance sheet. The warrant is re-measured at its then current fair value at each subsequent reporting date (it is “marked-to-market”).

If the warrant is determined to not have derivative features, it is recorded into equity at its fair value using the Black Scholes option model, however, limited to a relative fair value based upon the percentage of its fair value to the total fair value including the fair value of the convertible note.

Convertible debt instruments are recorded at fair value, limited to a relative fair value based upon the percentage of its fair value to the total fair value including the fair value of the warrant.

The warrant relative fair values are also recorded as a discount to the convertible promissory notes. As present, these equity features of the convertible promissory notes have recorded a discount to the convertible notes that is substantially equal to the proceeds received.

Non Cash Transactions [Policy Text Block]

Non-Cash Transactions

We determine the value assigned to each intangible we acquire, and/or services or products received for non-cash consideration of our common stock based on the market price of our common stock issued as consideration, at the date of the agreement of each transaction or when the service is rendered or product is received.

Revenue from Contract with Customer [Policy Text Block]

Revenue Recognition

We account for revenue in accordance with ASC 606, “Revenue from Contacts with Customers”. The guidance focuses on the core principle for revenue recognition, which is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, the guidance provides that an entity should apply the following steps:

Step 1: Identify the contract(s) with a customer.

Step 2: Identify the performance obligations in the contract.

Step 3: Determine the transaction price.

Step 4: Allocate the transaction price to the performance obligations in the contract.

Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation.

The Company’s products are sold through a contract with the customer and a written purchase order, in which the details of the contract are defined including the transaction price and method of shipment. The only performance obligation is to create and ship the product, and each product has separate pricing. Revenue is recognized at a point in time when the goods are shipped if the agreement is FOB manufacturer, and when goods are delivered if FOB destination. Revenue is recognized with a reduction for sales discounts, as appropriate and negotiated in the customer’s purchase order.

Service contracts are performed through a written contract, which specifies the performance obligations and the rate at which the services will be billed, typically by time and materials. Each service is separately negotiated and priced. Revenue is recognized as services are performed and completed, or, for services related to product installations, at the completion of the installation. A few contracts have called for milestone or fixed cost payments, where we invoice an agreed-to amount per month for the life of the contract. In these instances, completed work, billed hourly, is recognized as revenue. If the billing amount is greater or lesser than the completed work, a receivable or payable is created. These accounts are adjusted upon additional billings as the work is completed. To date, there have been no discounts or other financing terms for the contracts.

The Company has outstanding contract liability obligations of $21,000 as of March 31, 2023, recorded as deferred revenue. We recognized $8,000 in revenue and reduce the deferred revenue balance by the same amount as performance obligations were satisfied in the three months ended March 31 ,2023. The outstanding balance will be recognized over the remaining life of the contracts.

As we generate revenues from royalties or license fees from our intellectual property, a licensee will pay a license fee in one or more installments and ongoing royalties based on their sales of products incorporating or using our licensed intellectual property. We have entered into a licensing agreement for the CupriDyne Clean product, and we recognize royalty and license fees on a quarterly basis as the product is sold through to third parties and reported to us.

Clyra also has certain distribution agreements that call for consigned inventory. Although the product is shipped to a third party, it is not revenue until that consigned inventory is sold to end user customer.

Government Grants [Policy Text Block]

Government Grants

We have been awarded multiple research grants from the private and public Canadian research programs. The income we receive directly from grants is recorded as other income. We have been awarded over 80 grants since our first in 2015. Some of the funds from these grants are given directly to third parties (such as the University of Alberta or a third-party research scientist) to support research on our technology. The grants have terms generally ranging between six and eighteen months and support a majority, but not all, of the related research budget costs. This cooperative research allows us to utilize (i) a depth of resources and talent to accomplish highly skilled work, (ii) financial aid to support research and development costs, (iii) independent and credible validation of our technical claims.

The grants typically provide for (i) recurring monthly amounts, (ii) reimbursement of costs for research talent for which we invoice to request payment, and (iii) ancillary cost reimbursement for research talent travel related costs. All awarded grants have specific requirements on how the money is spent, typically to employ researchers. None of the funds may be used for general administrative expenses or overhead in the United States. These grants have substantially increased our level of research and development activities in Canada. We continue to apply for Canadian government and agency grants to fund research and development activities. Not all of our grant applications have been awarded, and no assurance can be made that any pending grant application, or any future grant applications, will be awarded.

Income Tax, Policy [Policy Text Block]

Income Taxes

The asset and liability approach is used to recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of asset and liabilities. Deferred tax assets and liabilities are determined based on the differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The effect on deferred tax asset and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

We account for uncertainties in income tax law under a comprehensive model for the financial statement recognition, measurement, presentation, and disclosure of uncertain tax positions taken or expected to be taken in income tax returns as prescribed by generally accepted accounting principles (“GAAP”).  Under GAAP, the tax effects of a position are recognized only if it is “more-likely-than-not” to be sustained by the taxing authority as of the reporting date.  If the tax position is not considered “more-likely-than-not” to be sustained, then no benefits of the position are recognized.  Management believes there are no unrecognized tax benefits or uncertain tax positions as of March 31, 2023, and December 31, 2022.

The Company assessed its earnings history, trends and estimates of future earnings and determined that the deferred tax asset could not be realized as of March 31, 2023, and December 31, 2022. Accordingly, a valuation allowance was recorded against the net deferred tax asset.

The Company recognizes interest and penalties on income taxes as a component of income tax expense, should such an expense be realized.

Fair Value of Financial Instruments, Policy [Policy Text Block]

Fair Value of Financial Instruments

Management believes the carrying amounts of the Company’s financial instruments as of March 31, 2023 and December 31, 2022 approximate their respective fair values because of the short-term nature of these instruments. Such instruments consist of cash, accounts receivable, prepaid assets, accounts payable, line of credit, and other assets and liabilities. The carrying amount of debt instruments are believed to approximate fair value as the stated interest rates are reflective of the prevailing market rates.

Tax Credits [Policy Text Block]

Tax Credits

Our research and development activities in Canada may entitle our Canadian subsidiary to claim benefits under the “Scientific Research and Experimental Development Program”, a Canadian federal tax incentive program designed to encourage Canadian businesses of all sizes and in all sectors to conduct research and development in Canada. Benefits under the program include credits to taxable income. If our Canadian subsidiary does not have taxable income in a reporting period, we instead receive a tax refund from the Canadian Revenue Authority. Those refunds are classified in Other Income on our Consolidated Statement of Operations and Comprehensive Loss.

Lessee, Leases [Policy Text Block]

Leases

At inception of a lease contract, we assess whether the contract is, or contains, a lease. Our assessment is based on: (1) whether the contract involves the use of a distinct identified asset, (2) whether we obtain the right to substantially all the economic benefit from the use of the asset throughout the period of the contract, and (3) whether we have the right to direct the use of the asset during such time period. At inception of a lease, we allocate the consideration in the contract to each lease component based on its relative stand-alone price to determine the lease payments. Leases are classified as either finance leases or operating leases. A lease must be classified as a finance lease if any of the following criteria are met: the lease transfers ownership of the asset by the end of the lease term, the lease contains an option to purchase the asset that is reasonably certain to be exercised, the lease term is for a major part of the remaining useful life of the asset or the present value of the lease payments equals or exceeds substantially all of the fair value of the asset. A lease is classified as an operating lease if it does not meet any of these criteria. We have no leases classified as finance leases. As of March 31, 2023, the weighted average remaining lease term for our operating leases was nine years. The weighted average discount rate for our operating leases was 18%. For all leases at the lease commencement date, a right-of-use asset and a lease liability are recognized. The right-of-use asset represents the right to use the leased asset for the lease term. The lease liability represents the present value of the lease payments under the lease. The right-of-use asset is initially measured at cost, which primarily comprises the initial amount of the lease liability, plus any initial direct costs incurred, consisting mainly of brokerage commissions, less any lease incentives received. All right-of-use assets are reviewed for impairment. The lease liability is initially measured at the present value of the lease payments, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, management estimates the incremental borrowing rate, which currently is estimated to be 18%. Lease payments included in the measurement of the lease liability comprise the following: the fixed noncancelable lease payments, payments for optional renewal periods where it is reasonably certain the renewal period will be exercised, and payments for early termination options unless it is reasonably certain the lease will not be terminated early. Lease components are included in the measurement of the initial lease liability. Additional payments based on a change in our portion of the operating expenses, including real estate taxes and insurance, are recorded as a period expense when incurred. Lease modifications result in remeasurement of the lease liability. Lease expense for operating leases consists of the lease payments plus any initial direct costs, primarily brokerage commissions, and is recognized on a straight-line basis over the lease term. We have elected not to recognize right-of-use assets and lease liabilities for short-term leases that have a term of 12 months or less. The effect of short-term leases on our right-of-use asset and lease liability was not material.

As of March 31, 2023, the right-of-use assets totaled $837,000 and the lease liability totaled $844,000 on our balance sheet related to our operating leases.

Property, Plant and Equipment, Policy [Policy Text Block]

Equipment

Equipment is stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, which range from 3 - 5 years. Additions, renewals, and betterments that significantly extend the life of the asset are capitalized. Expenditures for repairs and maintenance are charged to expense as incurred. For assets sold or otherwise disposed of, the cost and related accumulated depreciation and amortization are removed from the accounts, and any related gain or loss is reflected in income for the period.

Credit Loss, Financial Instrument [Policy Text Block]

Measurement of Credit Losses on Financial Instruments

In June 2016, the FASB issued ASU 2016-13, which sets out the principles for the recognition of measurement of credit losses on financial instruments, including trade receivables. The standard eliminates the probable initial recognition threshold and requires an entity to reflect its current estimate of all expected credit losses. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected. The new standard was effective for the Company beginning January 1, 2023 and primarily impacted trade accounts receivable. 

Accounts receivable are customer obligations that are unconditional. Accounts receivable are presented net of an allowance for doubtful accounts for expected credit losses, which represents an estimate of amounts that may not be collectible. The Company performs ongoing credit evaluations of its customers and, if necessary, provides an allowance for doubtful accounts and expected credit losses. A provision to the allowances for doubtful accounts for expected credit losses is recorded based on factors including the length of time the receivables are past due, the current business environment, and the Company’s historical experience. Provisions to the allowances for doubtful accounts for expected credit losses are recorded to general and administrative expenses. The Company writes off accounts receivable against the allowance when it determines a balance is uncollectible and no longer actively pursues collection of the receivable. The Company does not have any off-balance-sheet credit exposure related to customers. As of March 31, 2023 and December 31, 2022, the allowance for doubtful accounts for expected credit losses was $12,000.

New Accounting Pronouncements, Policy [Policy Text Block]

Recent Accounting Pronouncements

Currently there are no recently released pronouncements that are considered applicable to the Company’s financial statements.

XML

Note 2 - Summary of Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2023

Notes Tables

Schedule of Cash and Cash Equivalents [Table Text Block]

	March 31, 2023		December 31, 2022
BioLargo, Inc. and subsidiaries	$	3,171	$	1,685
Clyra Medical Technologies, Inc.		93		166
Total	$	3,264	$	1,851

Schedules of Concentration of Risk, by Risk Factor [Table Text Block]

	March 31, 2023			March 31, 2022
Customer A		86	%		29	%
Customer B	<10		%		14	%

	March 31, 2023			December 31, 2022
Customer A		70	%		24	%

Schedule of Inventory, Current [Table Text Block]

	March 31, 2023		December 31, 2022
Raw material	$	52	$	46
Finished goods		83		74
Total	$	135	$	120

Schedule of Other Assets, Noncurrent [Table Text Block]

	March 31, 2023		December 31, 2022
Patents	$	34	$	34
Security deposits		36		36
Tax credit receivable		54		54
Total	$	124	$	124

Schedule of Share-Based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]

	2023						2022
	Non Plan			2018 Plan			Non Plan			2018 Plan
Risk free interest rate		3.48	%		3.48	%	2.32	–	3.83%	2.32	–	3.83%
Expected volatility		114	%		114	%	114	–	117%	114	–	117%
Expected dividend yield		—			—			—			—
Forfeiture rate		—			—			—			—
Life in years		10			10			10			10

XML

Note 4 - Debt Obligations (Tables)

3 Months Ended

Mar. 31, 2023

Notes Tables

Schedule of Debt [Table Text Block]

	March 31, 2023		December 31, 2022
Current portion of debt:
SBA Paycheck Protection Program loan	$	43	$	43
Vehicle loan, current portion		13		—
Convertible note payable, matures March 1, 2023		—		50
SBA EIDL Loan, matures July 2053, current portion		10		10
Debt discount, net of amortization		—		(3	)
Total current portion of debt	$	66	$	100
Long-term debt:
SBA Paycheck Protection Program loans, matures May 2025	$	97	$	97
Vehicle loan, matures March 2029		65		—
SBA EIDL Loan, matures July 2053		140		140
Total long-term debt, net of current	$	302	$	237
Total	$	368	$	337

XML

Note 5 - Share-based Compensation (Tables)

3 Months Ended

Mar. 31, 2023

Notes Tables

Share-Based Payment Arrangement, Option, Activity [Table Text Block]

	Options Outstanding			Exercise Price per share				Weighted Average Price per share		Aggregate intrinsic Value(1)
Balance, December 31, 2022		28,484,549		$0.12	–	0.43	$	0.19
Granted		1,320,498			$0.20		$	0.2
Balance, March 31, 2023		29,805,047		$0.12	–	0.43	$	0.19
Unvested		(4,073,761	)	$0.12	–	0.32	$	0.19
Vested, March 31, 2023		25,731,286		$0.12	–	0.43	$	0.19	$	678,000
Balance, December 31, 2021		23,186,142		$0.16	–	0.40	$	0.19
Granted		2,621,229		$0.12	–	0.23	$	0.23
Balance, March 31, 2022		25,807,371		$0.12	–	0.40	$	0.19

						Weighted
						Average		Aggregate
	Options		Exercise			Price per		intrinsic
	Outstanding		price per share			share		Value(1)
Balance, December 31, 2022		1,904,085	$0.28	–	0.69	$	0.56
Expired		–		–			–
Balance, March 31, 2023		1,904,085	$0.28	–	0.69	$	0.56	$	–
Balance, December 31, 2021		2,879,246	$0.23	–	0.94	$	0.49
Expired		–		–			–
Balance, March 31, 2022		2,879,246	$0.23	–	0.94	$	0.49

							Weighted
	Non-plan						average		Aggregate
	Options			Exercise			price per		intrinsic
	outstanding			price per share			share		value(1)
Balance, December 31, 2022		19,023,829		$0.12	–	0.83	$	0.39
Granted		48,804			0.20			0.20
Balance, March 31, 2023		19,072,633		$0.12	–	0.83	$	0.39
Unvested		(507,500	)		0.45			0.45
Vested, March 31, 2023		18,565,133		$0.12	–	0.83	$	0.38	$	88,000
Balance, December 31, 2021		20,119,207		$0.12	–	0.83	$	0.39
Granted		32,609			0.23			0.23
Balance, March 31, 2022		20,151,816		$0.12	–	0.83	$	0.39

XML

Note 6 - Warrants (Tables)

3 Months Ended

Mar. 31, 2023

Notes Tables

Schedule of Stockholders' Equity Note, Warrants or Rights [Table Text Block]

							Weighted
							average		Aggregate
	Warrants			Exercise			price per		intrinsic
	outstanding			price per share			share		value(1)
Balance, December 31, 2022		49,023,398		$0.13	–	1.00	$	0.26
Granted		7,512,000		0.21	–	0.29		0.25
Expired		(4,684,986	)	0.19	–	0.35		0.21
Balance, March 31, 2023		51,850,412		$0.13	–	1.00	$	0.26	$	122,000
Balance, December 31, 2021		36,765,562		$0.16	–	1.00	$	0.27
Granted		10,393,936		0.20	–	0.25		0.22
Expired		(388,889	)		0.22			0.22
Balance, March 31, 2022		46,770,549		$0.14	–	1.00	$	0.29

Schedule Of Assumptions Used To Determine Fair Value Of Warrants [Table Text Block]

	2023			2022
Risk free interest rate	3.88	–	4.27%	3.69	–	3.88%
Expected volatility	40	–	95%		40%
Expected dividend yield		—			—
Forfeiture rate		—			—
Expected life in years	3	–	5		3

XML

Note 7 - Accounts Payable and Accrued Expenses (Tables)

3 Months Ended

Mar. 31, 2023

Notes Tables

Schedule of Accounts Payable and Accrued Liabilities [Table Text Block]

Category	BioLargo		ONM		BLEST		Water		Intercompany amounts			Totals
Accounts payable	$	169	$	794	$	37	$	121	$	(82	)	$	1,039
Accrued payroll		36		49		75		—		—			160
Accrued interest		25		—		—		—		—			25
Total												$	1,224

Category	BioLargo		ONM		BLEST		Water		Intercompany amounts			Totals
Accounts payable	$	187	$	486	$	7	$	119	$	(82	)	$	717
Accrued payroll		20		58		120		—		—			198
Accrued interest		25		—		—		—		—			25
Total												$	940

XML

Note 8 - Noncontrolling Interest - Clyra Medical (Tables)

3 Months Ended

Mar. 31, 2023

Notes Tables

Schedule of Other Ownership Interests [Table Text Block]

						Weighted
		Clyra				average
	Options		Exercise			price per
	Outstanding		price per share			share
Balance, December 31, 2022		15,833	$1.00	-	310	$	5.53
Granted		426	1.00	-	271		148.27
Balance, March 31, 2023		16,259	$1.00	-	310	$	9.27
Balance, December 31, 2021		14,004	$		1.00	$	1.00
Granted		648			1.00		1.00
Balance, March 31, 2022		14,652	$		1.00	$	1.00

Schedule of Share-Based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]

	2023						2022
	Non Plan			2018 Plan			Non Plan			2018 Plan
Risk free interest rate		3.48	%		3.48	%	2.32	–	3.83%	2.32	–	3.83%
Expected volatility		114	%		114	%	114	–	117%	114	–	117%
Expected dividend yield		—			—			—			—
Forfeiture rate		—			—			—			—
Life in years		10			10			10			10

Schedule of Accounts Payable and Accrued Liabilities [Table Text Block]

Category	BioLargo		ONM		BLEST		Water		Intercompany amounts			Totals
Accounts payable	$	169	$	794	$	37	$	121	$	(82	)	$	1,039
Accrued payroll		36		49		75		—		—			160
Accrued interest		25		—		—		—		—			25
Total												$	1,224

Category	BioLargo		ONM		BLEST		Water		Intercompany amounts			Totals
Accounts payable	$	187	$	486	$	7	$	119	$	(82	)	$	717
Accrued payroll		20		58		120		—		—			198
Accrued interest		25		—		—		—		—			25
Total												$	940

Clyra Medical [Member]

Notes Tables

Schedule of Share-Based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]

	March 31, 2023			December 31, 2022
Risk free interest rate	3.88	–	4.27%		2.32	%
Expected volatility		40%			40	%
Expected dividend yield		—			—
Forfeiture rate		—			—
Expected life in years		10			10

Schedule of Accounts Payable and Accrued Liabilities [Table Text Block]

Category	2023		2022
Accounts payable	$	235	$	186
Accrued payroll		6		45
Accrued interest		8		7
Accrued dividend		29		---
Total	$	278	$	238

XML

Note 11 - Business Segment Information (Tables)

3 Months Ended

Mar. 31, 2023

Notes Tables

Schedule of Segment Reporting Information, by Segment [Table Text Block]

March 31, 2023	BioLargo			ONM			Clyra			BLEST			Water			BETI			Elimination			Total
Revenue	$	—		$	3,543		$	6		$	363		$	—		$	—		$	(170	)	$	3,742
Intersegment revenue		—			—			—			(170	)		—			—			170			—
R&D expense		(189	)		—			(134	)		(245	)		(135	)		(32	)		170			(565	)
Operating income (loss)		(799	)		1,387			(426	)		(368	)		(184	)		(87	)		—			(477	)
Grant income		—			—			—			—			31			—			—			31
Interest expense		(36	)		(2	)		(10	)		—			—			—			—			(48	)
Net income (loss)		(835	)		1,385			(436	)		(368	)		(153	)		(87	)		—			(494	)

March 31, 2022	BioLargo			ONM			Clyra			BLEST			Water			Elimination			Total
Revenue	$	2		$	600		$	10		$	545		$	—		$	(188	)	$	965
Intersegment revenue		(2	)		(2	)		—			(188	)		—			192			—
Research and development		(265	)		—			(16	)		(108	)		(197	)		194			(392	)
Operating loss		(1,220	)		13			(240	)		(35	)		(228	)		—			(1,710	)
Grant income		—			—			—			—			5			—			5
Interest expense		(6	)		—			(7	)		—			—			—			(13	)
Net income (loss)		(1,226	)		187			(247	)		(35	)		(223	)		—			(1,544	)

As of March 31, 2023	BioLargo		ONM		Clyra		BLEST		Water		BETI		Elimination			Total
Tangible assets	$	530	$	3,392	$	578	$	505	$	223	$	628	$	(73	)	$	5,783
Right of use (leased assets)		114		—		—		723		—				—			837
Investment in South Korean joint venture		27		—		—		—		—				—			27
Total	$	671	$	3,392	$	578	$	1,228	$	223	$	628	$	(73	)	$	6,647

As of December 31, 2022	BioLargo		ONM		Clyra		BLEST		Water		Elimination			Total
Tangible assets	$	669	$	2,064	$	631	$	441	$	194	$	(41	)	$	3,958
Right of use (leased assets)		136		—		—		731		—		—			867
Investment in South Korean joint venture		33		—		—		—		—		—			33
Total	$	838	$	2,064	$	631	$	1,172	$	194	$	(41	)	$	4,858

XML

Note 1 - Business and Organization (Details Textual)	3 Months Ended
	Mar. 31, 2023 USD ($)	Mar. 31, 2022 USD ($)	Dec. 31, 2022 USD ($)	Sep. 30, 2017
Number of Wholly-Owned Subsidiaries	5
Revenue from Contract with Customer, Including Assessed Tax	$ 3,742,000	$ 965,000
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	(494,000)	(1,544,000)
Net Cash Provided by (Used in) Operating Activities	(43,000)	(1,140,000)
Working Capital (Deficit)	3,075,000
Assets, Current	4,874,000		$ 3,153,000
Stock Issued During Period, Value, New Issues	800,000	$ 1,202,000
Cash and Cash Equivalents, at Carrying Value	3,264,000		$ 1,851,000
SBA CARES Act Paycheck Protection Program [Member]
Long-Term Debt	140,000
Economic Injury Disaster Loan [Member]
Long-Term Debt	150,000
Inventory Line of Credit [Member] | Clyra Medical Technologies [Member]
Long-Term Line of Credit	247,000
Vehicle Loan [Member]
Long-Term Debt	78,000
The 2020 Unit Offering [Member]
Stock Issued During Period, Value, New Issues	695,000
Lincoln Park Capital Fund, LLC [Member]
Stock Issued During Period, Value, New Issues	$ 105,000
BioLargo Engineering, Science & Technologies, LLC [Member]
Noncontrolling Interest, Ownership Percentage by Parent	82.25%			100.00%
Clyra Medical Technologies [Member]
Noncontrolling Interest, Ownership Percentage by Parent	58.00%
Noncontrolling Interest, Increase from Subsidiary Equity Issuance	$ 225,000
BioLargo Energy Technologies, Inc (BETI) [Member]
Noncontrolling Interest, Ownership Percentage by Parent	97.10%
Noncontrolling Interest, Increase from Subsidiary Equity Issuance	$ 550,000

XML

Note 2 - Summary of Significant Accounting Policies (Details Textual)		3 Months Ended		12 Months Ended
	Mar. 20, 2020 USD ($)	Mar. 31, 2023 USD ($)	Mar. 31, 2022 USD ($)	Dec. 31, 2022 USD ($)	Jan. 22, 2021 USD ($)
Accounts Receivable, Allowance for Credit Loss, Current		$ 12,000		$ 12,000
Inventory Valuation Reserves		158,000		158,000
Income (Loss) from Equity Method Investments		(6,000)	$ (8,000)
Contract with Customer, Liability		21,000
Contract with Customer, Liability, Revenue Recognized		8,000
Unrecognized Tax Benefits, Ending Balance		$ 0		0
Operating Lease, Weighted Average Remaining Lease Term (Year)		9 years
Operating Lease, Weighted Average Discount Rate, Percent		18.00%
Operating Lease, Right-of-Use Asset		$ 837,000		$ 867,000
Operating Lease, Liability		844,000
Off-Balance-Sheet, Credit Loss, Liability		$ 0
Minimum [Member]
Property, Plant and Equipment, Useful Life (Year)		3 years
Maximum [Member]
Property, Plant and Equipment, Useful Life (Year)		5 years
Canadian Government Grants [Member] | Minimum [Member]
Grant Term (Month)		6 months
Canadian Government Grants [Member] | Maximum [Member]
Grant Term (Month)		18 months
Odin Co Ltd [Member]
Payments to Acquire Interest in Joint Venture	$ 100,000
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage	40.00%	40.00%		40.00%
Income (Loss) from Equity Method Investments		$ 6,000	$ 8,000
Odin Co Ltd [Member] | Tomorrow Water [Member]
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage	30.00%
Odin Co Ltd [Member] | BKT and Tomorrow Water [Member]
Payments to Acquire Interest in Joint Venture	$ 150,000
Patents [Member]
Intangible Assets, Net (Excluding Goodwill), Total					$ 34,000
Customer Concentration Risk [Member] | Revenue from Contract with Customer Benchmark [Member]
Number of Major Customers			2
Customer Concentration Risk [Member] | Revenue from Contract with Customer Benchmark [Member] | One Customer [Member]
Number of Major Customers		1
Concentration Risk, Percentage		10.00%
Customer Concentration Risk [Member] | Revenue from Contract with Customer Benchmark [Member] | Two Customers [Member]
Concentration Risk, Percentage			10.00%
Customer Concentration Risk [Member] | Accounts Receivable [Member]
Number of Major Customers		1
Customer Concentration Risk [Member] | Accounts Receivable [Member] | One Customer [Member]
Concentration Risk, Percentage		10.00%

XML

Note 2 - Summary of Significant Accounting Policies - Summary of Cash Balances (Details) - USD ($)	Mar. 31, 2023	Dec. 31, 2022
Cash and Cash Equivalents, at Carrying Value	$ 3,264,000	$ 1,851,000
Parent Company [Member]
Cash and Cash Equivalents, at Carrying Value	3,171,000	1,685,000
Noncontrolling Interest [Member]
Cash and Cash Equivalents, at Carrying Value	$ 93,000	$ 166,000

XML

Note 2 - Summary of Significant Accounting Policies - Credit Concentration (Details) - Customer Concentration Risk [Member]	3 Months Ended		12 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Customer A [Member] | Revenue from Contract with Customer Benchmark [Member]
Credit concentration	86.00%	29.00%
Customer A [Member] | Accounts Receivable [Member]
Credit concentration	70.00%		24.00%
Customer B [Member] | Revenue from Contract with Customer Benchmark [Member]
Credit concentration	10.00%	14.00%

XML

Note 2 - Summary of Significant Accounting Policies - Inventory (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Raw material	$ 52	$ 46
Finished goods	83	74
Total	$ 135	$ 120

XML

Note 2 - Summary of Significant Accounting Policies - Other Non-current Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Patents	$ 34	$ 34
Security deposits	36	36
Tax credit receivable	54	54
Total	$ 124	$ 124

XML

Note 2 - Summary of Significant Accounting Policies - Stock Options, Valuation Assumptions (Details)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Non Plan [Member]
Risk free interest rate	3.48%
Expected volatility	114.00%
Expected life in years (Year)	10 years	10 years
Non Plan [Member] | Minimum [Member]
Risk free interest rate		2.32%
Expected volatility		114.00%
Non Plan [Member] | Maximum [Member]
Risk free interest rate		3.83%
Expected volatility		117.00%
2018 Equity Incentive Plan [Member]
Expected life in years (Year)		10 years
2018 Equity Incentive Plan [Member] | Minimum [Member]
Risk free interest rate		2.32%
Expected volatility		114.00%
2018 Equity Incentive Plan [Member] | Maximum [Member]
Risk free interest rate		3.83%
Expected volatility		117.00%

XML

Note 3 - Sale of Stock for Cash (Details Textual) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 13, 2022
Proceeds from Issuance of Common Stock	$ 800,000	$ 1,202,000
Warrants Issued with 2020 Unit Offering [Member] | Maximum [Member]
Warrants and Rights Outstanding, Term (Year)	5 years
Warrants Issued with 2020 Unit Offering [Member] | Minimum [Member]
Warrants and Rights Outstanding, Term (Year)	6 months
The 2020 Unit Offering [Member]
Stock Issued During Period, Shares, New Issues (in shares)	3,656,000	5,196,968
Proceeds from Issuance of Common Stock	$ 695,000	$ 856,000
Lincoln Park Capital Fund, LLC [Member]
Stock Purchase Agreement, Maximum Amount of Common Stock			$ 10,000,000
Stock Issued During Period, Shares, New Issues (in shares)	545,402	1,506,821
Proceeds from Issuance of Common Stock	$ 105,000	$ 346,000

XML

Note 4 - Debt Obligations (Details Textual) - USD ($)					3 Months Ended
	Mar. 06, 2023	Feb. 07, 2023	May 12, 2022	Feb. 07, 2022	Mar. 31, 2023	Mar. 31, 2022	Jul. 31, 2020
Interest Expense, Debt					$ 48,000	$ 13,000
Paycheck Protection Program CARES Act [Member] | ONM [Member]
Extinguishment of Debt, Amount				$ 173,821
Proceeds from Issuance of Debt				$ 217,243
Paycheck Protection Program CARES Act [Member] | BELST [Member]
Proceeds from Issuance of Debt			$ 97,000
Economic Injury Disaster Loan [Member] | ONM [Member]
Interest Expense, Debt					$ 2,000
Debt Instrument, Face Amount							$ 150,000
Debt Instrument, Interest Rate, Stated Percentage							3.75%
Warrant Issued With Conversion of Note [Member]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights (in shares)	200,000
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share)	$ 0.21
Warrants and Rights Outstanding, Term (Year)	5 years
Conversion of Note into BETI Common Shares [Member]
Debt Conversion, Original Debt, Amount	$ 50,000
Vehicle Loan [Member]
Debt Instrument, Face Amount		$ 80,000
Debt Instrument, Interest Rate, Stated Percentage		5.29%
Debt Instrument, Periodic Payment		$ 1,118

XML

Note 4 - Debt Obligations - Schedule of Debt (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Long-term debt, current	$ 66	$ 100
Debt discount, net of amortization	0	(3)
Total current portion of debt	66	100
Total long-term debt, net of current	302	237
Total	368	337
Vehicle Loan [Member]
Long-term debt, current	13	0
Total long-term debt, net of current	65	0
Paycheck Protection Program CARES Act [Member]
SBA Paycheck Protection Program loan	43	43
SBA Paycheck Protection Program loans, matures May 2025	97	97
Convertible Note, Maturing On March 1, 2023 [Member]
Convertible notes	0	50
Economic Injury Disaster Loan [Member]
Long-term debt, current	10	10
Total long-term debt, net of current	$ 140	$ 140

XML

Note 5 - Share-based Compensation (Details Textual) - USD ($)						3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Mar. 22, 2022	Jun. 22, 2018	Sep. 07, 2017	Mar. 31, 2023	Mar. 31, 2022
Stock Issued During Period, Value, Issued for Services						$ 207,000	$ 17,000
Share Price (in dollars per share)	$ 0.20					$ 0.20
2018 Equity Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period (Year)				10 years
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized (in shares)	50,000,000			40,000,000		50,000,000
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Shares Authorized Per Year (in shares)				2,000,000
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross (in shares)						1,320,498	2,621,229
Share-Based Compensation Arrangements by Share-Based Payment Award, Options, Grants in Period, Weighted Average Exercise Price (in dollars per share)						$ 0.2	$ 0.23
The 2007 Equity Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period (Year)					10 years
Non Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross (in shares)						48,804	32,609
Share-Based Compensation Arrangements by Share-Based Payment Award, Options, Grants in Period, Weighted Average Exercise Price (in dollars per share)						$ 0.20	$ 0.23
Share-Based Payment Arrangement, Option [Member] | Clyra Medical Technologies [Member]
Share-Based Payment Arrangement, Expense						$ 61,000	$ 141,000
Selling, General and Administrative Expenses [Member]
Share-Based Payment Arrangement, Expense						256,000	$ 801,000
Officer [Member]
Stock Issued During Period, Value, Issued for Services						$ 6,000
Stock Issued During Period, Shares, Issued for Services (in shares)						30,747
Shares Issued, Price Per Share (in dollars per share)	$ 0.20					$ 0.20
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Minimum Cash Amount Receipt						$ 3,000,000
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Minimum Revenue Required						$ 3,000,000
Consultants [Member]
Stock Issued During Period, Value, Issued for Services	$ 201,000	$ 17,000
Stock Issued During Period, Shares, Issued for Services (in shares)	899,743	86,752
Shares Issued, Price Per Share (in dollars per share)	$ 0.20	$ 0.23				$ 0.20	$ 0.23
Consultants [Member] | 2018 Equity Incentive Plan [Member]
Stock Issued During Period, Value, Issued for Services							$ 97,000
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross (in shares)						102,564	447,032
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Fair Value						$ 19,000
Share-Based Compensation Arrangements by Share-Based Payment Award, Options, Grants in Period, Weighted Average Exercise Price (in dollars per share)						$ 0.20
Employees, Consultants, Officers, and Directors [Member] | 2018 Equity Incentive Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross (in shares)						1,320,498	2,621,229
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Fair Value						$ 248,000	$ 564,000
Director [Member] | 2018 Equity Incentive Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross (in shares)						347,730	444,092
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Fair Value						$ 65,000	$ 96,000
Share-Based Compensation Arrangements by Share-Based Payment Award, Options, Grants in Period, Weighted Average Exercise Price (in dollars per share)						$ 0.20	$ 0.23
Employees [Member] | 2018 Equity Incentive Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross (in shares)						570,204	1,690,257
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Fair Value						$ 108,000	$ 362,000
Share-Based Compensation Arrangements by Share-Based Payment Award, Options, Grants in Period, Weighted Average Exercise Price (in dollars per share)						$ 0.20	$ 0.23
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Vesting Period (Year)						4 years	4 years
Chief Financial Officer [Member] | 2018 Equity Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period (Year)			10 years
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross (in shares)			300,000			300,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Fair Value						$ 56,000
Share-Based Compensation Arrangements by Share-Based Payment Award, Options, Grants in Period, Weighted Average Exercise Price (in dollars per share)			$ 0.20
Term Extension (Year)			1 year
Share-based Compensation Arrangement By Share-based Payment Award, Options Grants Per Month, Gross (in shares)			25,000
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Vested, Number of Shares (in shares)			25,000
CFO and President [Member] | 2018 Equity Incentive Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross (in shares)							39,848
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Fair Value							$ 9,000
Share-Based Compensation Arrangements by Share-Based Payment Award, Options, Grants in Period, Weighted Average Exercise Price (in dollars per share)							$ 0.23
Vendors [Member] | Non Plan [Member]
Share-Based Payment Arrangement, Expense						$ 9,000	$ 7,000
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross (in shares)						48,804	32,609
Share-Based Compensation Arrangements by Share-Based Payment Award, Options, Grants in Period, Weighted Average Exercise Price (in dollars per share)						$ 0.20	$ 0.23

XML

Note 5 - Share-based Compensation - Stock Options (Details) - USD ($)		3 Months Ended		12 Months Ended
		Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
2018 Equity Incentive Plan [Member]
Options outstanding, balance (in shares)		28,484,549	23,186,142	23,186,142
Weighted average exercise price per share, balance (in dollars per share)		$ 0.19	$ 0.19	$ 0.19
Options granted (in shares)		1,320,498	2,621,229
Exercise price per share, granted (in dollars per share)		$ 0.20
Weighted average exercise price per share, granted (in dollars per share)		$ 0.2	$ 0.23
Options Unvested (in shares)		(4,073,761)
Weighted average exercise price per share, unvested (in dollars per share)		$ 0.19
Options Vested (in shares)		25,731,286
Weighted average exercise price per share, vested (in dollars per share)		$ 0.19
Vested, aggregate intrinsic value	[1]	$ 678,000
Options outstanding, balance (in shares)		29,805,047	25,807,371	28,484,549
Weighted average exercise price per share, balance (in dollars per share)		$ 0.19	$ 0.19	$ 0.19
2018 Equity Incentive Plan [Member] | Minimum [Member]
Exercise price per share, balance (in dollars per share)		0.12	0.16	0.16
Exercise price per share, granted (in dollars per share)			0.12
Exercise price per share, Unvested (in dollars per share)		0.12
Exercise price per share, Vested (in dollars per share)		0.12
Exercise price per share, balance (in dollars per share)		0.12	0.12	0.12
2018 Equity Incentive Plan [Member] | Maximum [Member]
Exercise price per share, balance (in dollars per share)		0.43	0.40	0.40
Exercise price per share, granted (in dollars per share)			0.23
Exercise price per share, Unvested (in dollars per share)		0.32
Exercise price per share, Vested (in dollars per share)		0.43
Exercise price per share, balance (in dollars per share)		$ 0.43	$ 0.40	$ 0.43
The 2007 Equity Incentive Plan [Member]
Options outstanding, balance (in shares)		1,904,085	2,879,246	2,879,246
Weighted average exercise price per share, balance (in dollars per share)		$ 0.56	$ 0.49	$ 0.49
Options outstanding, balance (in shares)		1,904,085	2,879,246	1,904,085
Weighted average exercise price per share, balance (in dollars per share)		$ 0.56	$ 0.49	$ 0.56
Options outstanding, Expired (in shares)		0	0
Weighted average exercise price per share, Expired (in dollars per share)		$ 0	$ 0
The 2007 Equity Incentive Plan [Member] | Minimum [Member]
Weighted average exercise price per share, balance (in dollars per share)		0.28	0.23	0.23
Weighted average exercise price per share, balance (in dollars per share)		0.28	0.23	0.28
Weighted average exercise price per share, Expired (in dollars per share)
The 2007 Equity Incentive Plan [Member] | Maximum [Member]
Weighted average exercise price per share, balance (in dollars per share)		0.69	0.94	0.94
Weighted average exercise price per share, balance (in dollars per share)		0.69	0.94	$ 0.69
Weighted average exercise price per share, Expired (in dollars per share)
Non Plan [Member]
Options outstanding, balance (in shares)		19,023,829	20,119,207	20,119,207
Weighted average exercise price per share, balance (in dollars per share)		$ 0.39	$ 0.39	$ 0.39
Options granted (in shares)		48,804	32,609
Exercise price per share, granted (in dollars per share)		$ 0.20	$ 0.23
Weighted average exercise price per share, granted (in dollars per share)		$ 0.20	$ 0.23
Options Unvested (in shares)		(507,500)
Exercise price per share, Unvested (in dollars per share)		$ 0.45
Weighted average exercise price per share, unvested (in dollars per share)		$ 0.45
Options Vested (in shares)		18,565,133
Weighted average exercise price per share, vested (in dollars per share)		$ 0.38
Vested, aggregate intrinsic value	[2]	$ 88,000
Options outstanding, balance (in shares)		19,072,633	20,151,816	19,023,829
Weighted average exercise price per share, balance (in dollars per share)		$ 0.39	$ 0.39	$ 0.39
Non Plan [Member] | Minimum [Member]
Exercise price per share, balance (in dollars per share)		0.12	0.12	0.12
Exercise price per share, Vested (in dollars per share)		0.12
Exercise price per share, balance (in dollars per share)		0.12	0.12	0.12
Non Plan [Member] | Maximum [Member]
Exercise price per share, balance (in dollars per share)		0.83	0.83	0.83
Exercise price per share, granted (in dollars per share)
Exercise price per share, Vested (in dollars per share)		0.83
Exercise price per share, balance (in dollars per share)		$ 0.83	$ 0.83	$ 0.83

[1] Aggregate intrinsic value based on closing common stock price of $0.20 at March 31, 2023.

[2] Aggregate intrinsic value based on closing common stock price of $0.18 at June 30, 2022.

XML

Note 6 - Warrants (Details Textual) - USD ($)	Mar. 31, 2023	Mar. 06, 2023	Mar. 31, 2022
Share Price (in dollars per share)	$ 0.20
Note Payable, Maturing March 8, 2023 [Member]
Debt Instrument, Face Amount		$ 50,000
Six-month Warrants in Connection With the 2020 Unit Offering [Member]
Warrants and Rights Outstanding, Term (Year)	6 months		6 months
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right (in shares)	3,656,000		5,196,968
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share)	$ 0.228		$ 0.204
Five-year Warrants in Connection With the 2020 Unit Offering [Member]
Warrants and Rights Outstanding, Term (Year)	5 years		5 years
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right (in shares)	3,656,000		5,196,968
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share)	$ 0.285		$ 0.25
Warrants Issued in Connection with Conversion of Interest on Note Payable Maturing March 8, 2023 [Member]
Warrants and Rights Outstanding, Term (Year)		5 years
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right (in shares)		200,000
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share)		$ 0.21
Warrants and Rights Outstanding		$ 30,000

XML

Note 6 - Warrants - Warrants Outstanding (Details) - USD ($)		3 Months Ended
		Mar. 31, 2023	Mar. 31, 2022
Balance, outstanding (in shares)		49,023,398	36,765,562
Granted (in shares)		7,512,000	10,393,936
Expired (in shares)		(4,684,986)	(388,889)
Expired, price range (in dollars per share)			$ 0.22
Balance, aggregate intrinsic value	[1]	$ 122,000
Balance, outstanding (in shares)		51,850,412	46,770,549
Minimum [Member]
Balance, outstanding, price range (in dollars per share)		$ 0.13	$ 0.16
Granted, price range (in dollars per share)		0.21	0.20
Expired, price range (in dollars per share)		0.19
Balance, outstanding, price range (in dollars per share)		0.13	0.14
Maximum [Member]
Balance, outstanding, price range (in dollars per share)		1.00	1.00
Granted, price range (in dollars per share)		0.29	0.25
Expired, price range (in dollars per share)		0.35
Balance, outstanding, price range (in dollars per share)		1.00	1.00
Weighted Average [Member]
Balance, outstanding, price range (in dollars per share)		0.26	0.27
Granted, price range (in dollars per share)		0.25	0.22
Expired, price range (in dollars per share)		0.21
Balance, outstanding, price range (in dollars per share)		$ 0.26	$ 0.29

[1] Aggregate intrinsic value based on closing common stock price of $0.20 at March 31, 2023.

XML

Note 6 - Warrants - Assumptions Used to Determine Fair Value of Warrants (Details)	Mar. 31, 2023	Dec. 31, 2022
Measurement Input, Price Volatility [Member]
Risk free interest rate		0.40
Measurement Input, Expected Term [Member]
Risk free interest rate		3
Minimum [Member] | Measurement Input, Risk Free Interest Rate [Member]
Risk free interest rate	0.0388	0.0369
Minimum [Member] | Measurement Input, Price Volatility [Member]
Risk free interest rate	0.40
Maximum [Member] | Measurement Input, Risk Free Interest Rate [Member]
Risk free interest rate	0.0427	0.0388
Maximum [Member] | Measurement Input, Price Volatility [Member]
Risk free interest rate	0.95
Maximum [Member] | Measurement Input, Expected Term [Member]
Risk free interest rate	5

XML

Note 7 - Accounts Payable and Accrued Expenses - Summary of Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Accounts payable	$ 1,039	$ 717
Accrued payroll	160	198
Accrued interest	25	25
Total	1,224	940
Corporate, Non-Segment [Member]
Accounts payable	169	187
Accrued payroll	36	20
Accrued interest	25	25
Total
Operating Segments [Member] | Odor-No-More [Member]
Accounts payable	794	486
Accrued payroll	49	58
Accrued interest	0	0
Total
Operating Segments [Member] | BLEST [Member]
Accounts payable	37	7
Accrued payroll	75	120
Accrued interest	0	0
Total
Operating Segments [Member] | BioLargo Water [Member]
Accounts payable	121	119
Accrued payroll	0	0
Accrued interest	0	0
Total
Consolidation, Eliminations [Member]
Accounts payable	(82)	(82)
Accrued payroll	0	0
Accrued interest	0	0
Total

XML

Note 8 - Noncontrolling Interest - Clyra Medical (Details Textual) - USD ($)				3 Months Ended		12 Months Ended
	Dec. 20, 2022	Mar. 02, 2022	Jun. 30, 2020	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022	Apr. 08, 2022
Preferred Stock, Shares Outstanding (in shares)				0		0
Proceeds from Issuance of Preferred Stock and Preference Stock				$ 225,000	$ 0
Clyra Medical [Member]
Common Stock, Shares, Outstanding, Ending Balance (in shares)						91,149
Shares Issued, Price Per Share (in dollars per share)	$ 310
Share-Based Compensation Arrangements by Share-Based Payment Award, Options, Grants in Period, Weighted Average Exercise Price (in dollars per share)				$ 148.27	$ 1.00
Clyra Medical [Member] | Vendors and Employees [Member] | Share-Based Payment Arrangement, Option [Member]
Share-Based Payment Arrangement, Expense				$ 61,000	$ 141,000
Clyra Medical [Member] | Employees and Consultants [Member] | Share-Based Payment Arrangement, Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Discount Rate				30.00%
Clyra Medical [Member] | Employees and Consultants [Member] | The Remaining Options [Member]
Share-Based Compensation Arrangements by Share-Based Payment Award, Options, Grants in Period, Weighted Average Exercise Price (in dollars per share)				$ 310
Clyra Medical [Member] | Warrants Issued in Conjunction With the Sale of Series A Preferred Stock [Member]
Warrants and Rights Outstanding, Term (Year)	3 years
Warrants and Rights Outstanding	$ 110,000
Clyra Medical [Member] | Shares Issued for Debt Owed to Biolargo [Member]
Debt Conversion, Converted Instrument, Amount		$ 633,091
Debt Conversion, Converted Instrument, Shares Issued (in shares)		2,032
Clyra Medical [Member] | Series A Preferred Stock [Member]
Preferred Stock, Shares Outstanding (in shares)						2,800
Stock Issued During Period, Shares, New Issues (in shares)	725			725
Proceeds from Issuance of Preferred Stock and Preference Stock	$ 225,000			$ 225,000
Shares Issued, Price Per Share (in dollars per share)	$ 372
Preferred Stock, Dividend Rate, Percentage	15.00%
Preferred Stock, Convertible, Sale of Stock Amount	$ 5,000,000
Clyra Medical [Member] | Revolving Credit Facility [Member] | Vernal Bay Capital Group, LLC [Member] | Inventory Line of Credit [Member]
Debt Instrument, Interest Rate, Stated Percentage			15.00%
Line of Credit Facility, Maximum Borrowing Capacity			$ 1,000,000
Proceeds from Lines of Credit, Total			260,000
Repayments of Lines of Credit			$ 113,000
Line of Credit Facility, Covenant, Additional Draws, Maximum Percentage of Total Principal Outstanding Allowed			50.00%
Line of Credit Facility, Covenant, Additional Draws, Minimum Amount Allowed			$ 200,000
Debt Instrument, Term (Year)			1 year
Line of Credit Facility, Monthly Percentage of Gross Product Sales Required to be Used as Payment of Debt on First 180 Days			30.00%
Line of Credit Facility, Monthly Percentage of Gross Product Sales Required to be Used as Payment of Debt after the First 180 Days			60.00%
Stock Issued During Period, Shares, Commitment Fee (in shares)			322			322
Stock Issued During Period, Value, Commitment Fee			$ 70,000
Debt Instrument, Percentage of Principal Payment, Cap						15.00%
Long-Term Line of Credit				$ 147,000		$ 161,000
Clyra Medical [Member] | Notes Payable, Other Payables [Member]
Debt Instrument, Face Amount							$ 100,000
Debt Instrument, Interest Rate, Stated Percentage							8.00%
Debt Instrument, Convertible, Sale of Stock Amount							$ 5,000,000
Debt Instrument, Convertible, Conversion Percentage							70.00%
Vernal Bay Capital Group, LLC [Member] | Conversion of Clyra Medical Stock Into Biolargo Common Stock [Member]
Conversion of Stock, Shares Issued (in shares)				527,983
Clyra Medical Technologies [Member]
Noncontrolling Interest, Ownership Percentage by Parent				58.00%
Clyra Medical [Member] | Common Stock [Member]
Investment Owned, Balance, Shares (in shares)						51,571
Clyra Medical [Member] | Preferred Stock, Series A [Member]
Investment Owned, Balance, Shares (in shares)						1,352

XML

Note 8 - Noncontrolling Interest - Clyra Medical - Common Shares Outstanding (Details) - Clyra Medical [Member] - $ / shares	3 Months Ended		12 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Options outstanding, balance (in shares)	15,833	14,004	14,004
Balance, Exercise Price Range (in shares)		1.00	1.00
Weighted average exercise price per share, balance (in dollars per share)	$ 5.53	$ 1.00	$ 1.00
Options granted (in shares)	426	648
Granted, Exercise Price (in dollars per share)		$ 1.00
Weighted average exercise price per share, granted (in dollars per share)	$ 148.27	$ 1.00
Options outstanding, balance (in shares)	16,259	14,652	15,833
Balance, Exercise Price Range (in shares)		1.00
Weighted average exercise price per share, balance (in dollars per share)	$ 9.27	$ 1.00	$ 5.53
Minimum [Member]
Balance, Exercise Price Range (in shares)	1.00
Granted, Exercise Price (in dollars per share)	$ 1.00
Balance, Exercise Price Range (in shares)	1.00		1.00
Maximum [Member]
Balance, Exercise Price Range (in shares)	310
Granted, Exercise Price (in dollars per share)	$ 271
Balance, Exercise Price Range (in shares)	310		310

XML

Note 8 - Noncontrolling Interest - Clyra Medical - Valuation Assumptions (Details)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Clyra Medical [Member] | Vendors and Employees [Member]
Risk free interest rate		2.32%
Expected volatility	40.00%	40.00%
Expected life in years (Year)	10 years	10 years
Maximum [Member] | Clyra Medical [Member] | Vendors and Employees [Member]
Risk free interest rate	4.27%
Non Plan [Member]
Risk free interest rate	3.48%
Expected volatility	114.00%
Expected life in years (Year)	10 years	10 years
Non Plan [Member] | Minimum [Member]
Risk free interest rate		2.32%
Expected volatility		114.00%
Non Plan [Member] | Minimum [Member] | Clyra Medical [Member] | Vendors and Employees [Member]
Risk free interest rate	3.88%
Non Plan [Member] | Maximum [Member]
Risk free interest rate		3.83%
Expected volatility		117.00%

XML

Note 8 - Noncontrolling Interest - Clyra Medical - Summary of Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Accounts payable	$ 1,039	$ 717
Accrued payroll	160	198
Accrued interest	25	25
Accounts payable and accrued expenses, total	1,224	940
Clyra Medical [Member]
Accounts payable	235	186
Accrued payroll	6	45
Accrued interest	8	7
Accrued dividend	29
Accounts payable and accrued expenses, total	$ 278	$ 238

XML

Note 9 - BioLargo Engineering, Science and Technologies, LLC (Details Textual) - USD ($)		1 Months Ended		3 Months Ended		12 Months Ended		25 Months Ended
	Nov. 04, 2019	Jan. 30, 2021	Sep. 30, 2017	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022	Dec. 31, 2021	Sep. 30, 2019
Share-based Payment Arrangement, Noncash Expense, Total				$ 256,000	$ 801,000
Percentage of Profits Interests Vested	2.50%	3.75%
Percentage of Option to Purchase Shares of Common Stock	10.00%	15.00%
Seven Employees Working at BioLargo Engineering, Science & Technologies, LLC [Member]
Deferred Compensation Arrangement with Individual, Requisite Service Period (Year)			5 years
Potential Ownership Percentage of Subsidiary Held by Subsidiary Employees Based on Performance			30.00%
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross (in shares)	175,000	262,500				1,242,500	525,000
Incentive Issuance Stipulations for Subsidiary Employees, Accounts Receivable Collected by Year One of Operation			90.00%
Incentive Issuance Stipulations for Subsidiary Employees, Profit Earned in Year One of Operation			10.00%
Percentage of Profits Interests Vested						17.75%	11.25%
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value	$ 44,000	$ 65,000				$ 135,000	$ 65,000
Seven Employees Working at BioLargo Engineering, Science & Technologies, LLC [Member] | Non-Qualified Stock Option [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross (in shares)			1,750,000
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Vesting Period (Year)			5 years
Share-based Payment Arrangement, Noncash Expense, Total								$ 0
BioLargo Engineering, Science & Technologies, LLC [Member]
Noncontrolling Interest, Ownership Percentage by Parent			100.00%	82.25%

XML

Note 10 - BioLargo Energy Technologies, Inc. (Details Textual)	3 Months Ended
	Mar. 31, 2023 USD ($) $ / shares shares
BioLargo Energy Technologies, Inc (BETI) [Member]
Investment Owned, Balance, Shares (in shares)	9,050,000
BioLargo Energy Technologies, Inc (BETI) [Member]
Common Stock, Shares, Outstanding, Ending Balance (in shares)	9,325,000
Conversion From BioLargo Note Payable to Shares [Member]
Debt Conversion, Original Debt, Amount | $	$ 50,000
Debt Conversion, Converted Instrument, Shares Issued (in shares)	25,000
BioLargo Energy Technologies, Inc (BETI) [Member]
Stock Issued During Period, Shares, New Issues (in shares)	50,000
Proceeds from Issuance or Sale of Equity | $	$ 100,000
Stock Conversion, Discount on Volume Weighted average Price	20.00%
BioLargo Energy Technologies, Inc (BETI) [Member] | Third Party Investors [Member]
Proceeds from Issuance or Sale of Equity | $	$ 550,000
BioLargo Energy Technologies, Inc (BETI) [Member] | Subsidiaries [Member]
Stock Issued During Period, Shares, New Issues (in shares)	325,000
Sale of Stock, Price Per Share (in dollars per share) | $ / shares	$ 2.00

XML

Note 11 - Business Segment Information (Details Textual)	3 Months Ended
	Mar. 31, 2023
Number of Operating Segments	4

XML

Note 11 - Business Segment Information - Segment Information (Details) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Revenue from Contract with Customer, Including Assessed Tax	$ 3,742,000	$ 965,000
Intersegment revenue	0	0
Research and development	(565,000)	(392,000)
Operating income (loss)	(477,000)	(1,710,000)
Grant income	31,000	5,000
Interest expense	(48,000)	(13,000)
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	(494,000)	(1,544,000)
Research and development	(565,000)	(392,000)
Operating income (loss)	(477,000)	(1,710,000)
Tangible assets	5,783,000		$ 3,958,000
Operating Lease, Right-of-Use Asset	837,000		867,000
Investment in South Korean joint venture	27,000		33,000
Total	6,647,000
Total			4,858,000
Investment in South Korean Joint Venture [Member]
Investment in South Korean joint venture	27,000		33,000
Corporate, Non-Segment [Member]
Revenue from Contract with Customer, Including Assessed Tax	0	2,000
Intersegment revenue	0	(2,000)
Research and development	(189,000)	(265,000)
Operating income (loss)	(799,000)	(1,220,000)
Grant income	0	0
Interest expense	(36,000)	(6,000)
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	(835,000)	(1,226,000)
Research and development	(189,000)	(265,000)
Operating income (loss)	(799,000)	(1,220,000)
Tangible assets	530,000		669,000
Operating Lease, Right-of-Use Asset	114,000		136,000
Total	671,000
Total			838,000
Corporate, Non-Segment [Member] | Investment in South Korean Joint Venture [Member]
Investment in South Korean joint venture	27,000		33,000
Operating Segments [Member] | Odor-No-More [Member]
Revenue from Contract with Customer, Including Assessed Tax	3,543,000	600,000
Intersegment revenue	0	(2,000)
Research and development	0	0
Operating income (loss)	1,387,000	13,000
Grant income	0	0
Interest expense	(2,000)	0
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	1,385,000	187,000
Research and development	0	0
Operating income (loss)	1,387,000	13,000
Tangible assets	3,392,000		2,064,000
Operating Lease, Right-of-Use Asset	0		0
Total	3,392,000
Total			2,064,000
Operating Segments [Member] | Odor-No-More [Member] | Investment in South Korean Joint Venture [Member]
Investment in South Korean joint venture	0		0
Operating Segments [Member] | Clyra Medical [Member]
Revenue from Contract with Customer, Including Assessed Tax	6,000
Intersegment revenue	0
Research and development	(134,000)
Operating income (loss)	(426,000)
Grant income	0
Interest expense	(10,000)
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	(436,000)
Research and development	(134,000)
Operating income (loss)	(426,000)
Tangible assets	578,000		631,000
Operating Lease, Right-of-Use Asset	0		0
Total	578,000
Total			631,000
Operating Segments [Member] | Clyra Medical [Member] | Investment in South Korean Joint Venture [Member]
Investment in South Korean joint venture	0		0
Operating Segments [Member] | BLEST [Member]
Revenue from Contract with Customer, Including Assessed Tax	363,000	545,000
Intersegment revenue		(188,000)
Research and development		(108,000)
Operating income (loss)		(35,000)
Grant income		0
Interest expense		0
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest		(35,000)
Research and development		(108,000)
Operating income (loss)		(35,000)
Tangible assets	505,000		441,000
Operating Lease, Right-of-Use Asset	723,000		731,000
Total	1,228,000
Total			1,172,000
Operating Segments [Member] | BLEST [Member] | Investment in South Korean Joint Venture [Member]
Investment in South Korean joint venture	0		0
Operating Segments [Member] | BioLargo Water [Member]
Revenue from Contract with Customer, Including Assessed Tax	0	0
Intersegment revenue	0	0
Research and development	(135,000)	(197,000)
Operating income (loss)	(184,000)	(228,000)
Grant income	31,000	5,000
Interest expense	0	0
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	(153,000)	(223,000)
Research and development	(135,000)	(197,000)
Operating income (loss)	(184,000)	(228,000)
Tangible assets	223,000		194,000
Operating Lease, Right-of-Use Asset	0		0
Total	223,000
Total			194,000
Operating Segments [Member] | BioLargo Water [Member] | Investment in South Korean Joint Venture [Member]
Investment in South Korean joint venture	0		0
Operating Segments [Member] | BioLargo Energy Technologies, Inc (BETI) [Member]
Revenue from Contract with Customer, Including Assessed Tax	0
Intersegment revenue	0
Research and development	(32,000)
Operating income (loss)	(87,000)
Grant income	0
Interest expense	0
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	(87,000)
Research and development	(32,000)
Operating income (loss)	(87,000)
Tangible assets	628,000
Operating Lease, Right-of-Use Asset
Total	628,000
Operating Segments [Member] | BioLargo Energy Technologies, Inc (BETI) [Member] | Investment in South Korean Joint Venture [Member]
Investment in South Korean joint venture
Operating Segments [Member] | Clyra Segment [Member]
Revenue from Contract with Customer, Including Assessed Tax		10,000
Intersegment revenue		0
Research and development		(16,000)
Operating income (loss)		(240,000)
Grant income		0
Interest expense		(7,000)
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest		(247,000)
Research and development		(16,000)
Operating income (loss)		(240,000)
Operating Segments [Member] | BioLargo Engineering, Science & Technologies, LLC [Member]
Intersegment revenue	(170,000)
Research and development	(245,000)
Operating income (loss)	(368,000)
Grant income	0
Interest expense	0
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	(368,000)
Research and development	(245,000)
Operating income (loss)	(368,000)
Intersegment Eliminations [Member]
Revenue from Contract with Customer, Including Assessed Tax	(170,000)	(188,000)
Intersegment revenue	170,000	192,000
Research and development	170,000	194,000
Operating income (loss)	0	0
Grant income	0	0
Interest expense	0	0
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	0	0
Research and development	170,000	194,000
Operating income (loss)	0	$ 0
Consolidation, Eliminations [Member]
Tangible assets	(73,000)		(41,000)
Operating Lease, Right-of-Use Asset	0		0
Total	(73,000)
Total			(41,000)
Consolidation, Eliminations [Member] | Investment in South Korean Joint Venture [Member]
Investment in South Korean joint venture	$ 0		$ 0

XML

Note 12 - Commitments and Contingencies (Details Textual) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Sep. 30, 2022
Operating Lease, Expense	$ 83,000	$ 63,000
Operating Lease, Weighted Average Remaining Lease Term (Year)	9 years
Lessee, Operating Lease, Discount Rate	18.00%
Westminster, California Facility Lease [Member]
Lessee, Operating Lease, Renewal Term (Year)	4 years
Oak Ridge, Tennessee Facility Lease [Member]
Operating Lease, Weighted Average Remaining Lease Term (Year)			10 years

XML

Note 13 - Subsequent Events (Details Textual) - USD ($)		1 Months Ended	3 Months Ended
	Dec. 20, 2022	May 12, 2023	Mar. 31, 2023	Mar. 31, 2022
Proceeds from Issuance of Common Stock			$ 800,000	$ 1,202,000
Proceeds from Issuance of Preferred Stock and Preference Stock			$ 225,000	$ 0
Clyra Medical [Member]
Shares Issued, Price Per Share (in dollars per share)	$ 310
Series A Preferred Stock [Member] | Clyra Medical [Member]
Stock Issued During Period, Shares, New Issues (in shares)	725		725
Proceeds from Issuance of Preferred Stock and Preference Stock	$ 225,000		$ 225,000
Shares Issued, Price Per Share (in dollars per share)	$ 372
Subsequent Event [Member] | Clyra Medical [Member] | Warrant [Member]
Warrants and Rights Outstanding, Term (Year)		3 years
Shares Issued, Price Per Share (in dollars per share)		$ 372
Subsequent Event [Member] | Series A Preferred Stock [Member] | Clyra Medical [Member]
Stock Issued During Period, Shares, New Issues (in shares)		401
Proceeds from Issuance of Preferred Stock and Preference Stock		$ 124,000
Lincoln Park Capital Fund, LLC [Member]
Stock Issued During Period, Shares, New Issues (in shares)			545,402	1,506,821
Proceeds from Issuance of Common Stock			$ 105,000	$ 346,000
Lincoln Park Capital Fund, LLC [Member] | Subsequent Event [Member]
Stock Issued During Period, Shares, New Issues (in shares)		567,713
Proceeds from Issuance of Common Stock		$ 101,000