Annual report [Section 13 and 15(d), not S-K Item 405]

Note 5 - Property and Equipment, Net

Note 5 - Property and Equipment, Net

12 Months Ended

Dec. 31, 2024

Property, Plant and Equipment Disclosure [Text Block]

5.	Property, plant and equipment, net

Property, plant and equipment, net, consisted of the following (in thousands):

			December 31,
Asset Class	Useful Life (Years)		2024			2023

Operational equipment		3 - 10	$	3,551		$	3,581
Lab equipment		5		1,128			817
Computer equipment		3		107			89
Office furniture and equipment		3		87			90
Leasehold improvements		2.5		80			80
Land		-		1,141			1,141
Building		39		3,131			3,131
Equipment under construction				9,726			3,047
				18,951			11,976
Less: accumulated depreciation				(2,478	)		(1,629	)

Property, plant and equipment, net			$	16,473		$	10,347

Property, plant and equipment depreciation expense was $0.9 million and $0.9 million for the years ended December 31, 2024 and December 31, 2023, respectively. Equipment under construction is comprised of our lithium-ion battery recycling commercial equipment along with various components being manufactured or installed by the Company.

In 2024, management shifted its strategic focus to prioritizing lithium carbonate production alongside mixed hydroxide precipitate. This decision aimed to reduce capital and operational intensity while enabling a larger-scale facility with higher revenue and improved margins than the previous design. As a result of this strategic shift, at December 31, 2024 the Company recognized an impairment of approximately $2,640,000 related to vendor equipment deposits for equipment that was initially required for Phase One of the recycling campus at TRIC but is no longer needed under the revised plan. The $2,640,000 write-down of vendor equipment deposits was recognized as an impairment expense and is included under “Impairment expense” in the Consolidated Statement of Operations for the year ended December 31, 2024. The fair value of the impaired assets was determined based on management’s assessment of recoverability, as the equipment was no longer needed.

During 2023, management had shifted focus away from the original service under the ACME lead recycling license agreement to a new primary focus on the Lithium recycling business as a Company. As a result, management sees a decrease in the utilization of the ACME plant and its related operations, and assessed that the future expected cash flows connected with ACME are at or near zero. Therefore, at December 31, 2023, we recognized an impairment of approximately $3,451,000 to equipment under construction that was not yet capitalized related to the ACME CIP as a result of the suspension of the development of recycling operations at the ACME Metals Taiwanese facility.