NOTE
11 – LEASES
The
Company leases research and development facilities, equipment and offices under finance and operating leases. For leases with terms greater
than 12 months, the Company records the related asset and obligation at the present value of lease payments over the term. Many of the
leases include rental escalation clauses, renewal options and/or termination options that are factored into the determination of lease
payments when appropriate.
The
Company’s leases do not provide a readily determinable implicit rate. Therefore, the Company estimated the incremental borrowing
rate to discount the lease payments based on information available at lease commencement.
Manufacturing
facilities
The
Company leases space for its manufacturing facilities under operating lease agreements. The leasing contracts are for a period of 3-10
years.
Offices
The
Company leases space for offices under operating leases. The leasing contracts are valid for terms of 4 years.
Lease
Position
The
table below presents the lease-related assets and liabilities recorded on the balance sheet:
SCHEDULE
OF LEASE-RELATED ASSETS AND LIABILITIES
| | |
2024 | | |
2023 | |
| | |
December
31, | |
| | |
2024 | | |
2023 | |
| Assets | |
| | | |
| | |
| Operating Leases | |
| | | |
| | |
| Operating lease right-of-use assets | |
$ | - | | |
$ | 351 | |
| | |
| | | |
| | |
| Finance Leases | |
| | | |
| | |
| Property, plants and equipment, gross | |
| 136 | | |
| 89 | |
| Accumulated depreciation | |
| (136 | ) | |
| (65 | ) |
| Property and equipment, net | |
$ | - | | |
$ | 24 | |
| | |
| | | |
| | |
| Liabilities | |
| | | |
| | |
| Current liabilities | |
| | | |
| | |
| Current maturities of operating leases | |
$ | 234 | | |
$ | 216 | |
| Current maturities of long-term finance leases | |
$ | 25 | | |
$ | 18 | |
| | |
| | | |
| | |
| Long-term liabilities | |
| | | |
| | |
| Non-current operating leases | |
$ | 1,308 | | |
$ | 96 | |
| Long-term finance leases | |
$ | 1 | | |
$ | 4 | |
| | |
| | | |
| | |
| Weighted Average Remaining Lease Term | |
| | | |
| | |
| Operating leases | |
| 6.5
years | | |
| 1.1
years | |
| Finance leases | |
| 0.6
years | | |
| 1.2
years | |
Weighted
Average Discount Rate | |
| | | |
| | |
| Operating leases | |
| 9.2 | % | |
| 7.5 | % |
| Finance leases | |
| 10.4 | % | |
| 2.0 | % |
Lease
Costs
The
table below presents certain information related to lease costs and finance and operating leases:
SCHEDULE
OF LEASE COSTS
| | |
2024 | | |
2023 | |
| | |
Years
ended December 31, | |
| | |
2024 | | |
2023 | |
| | |
(in
Thousands) | |
| Operating lease
cost: | |
$ | 542 | | |
$ | 561 | |
| | |
| | | |
| | |
| Finance lease cost: | |
| | | |
| | |
| Amortization of leased assets | |
| 60 | | |
| 46 | |
| Interest on lease liabilities | |
| 4 | | |
| 5 | |
| Total finance lease
cost | |
$ | 64 | | |
$ | 51 | |
The
table below presents supplemental cash flow information related to lease:
SCHEDULE OF SUPPLEMENTAL CASHFLOW INFORMATION
| | |
Years
ended December 31, | |
| | |
2024 | | |
2023 | |
| | |
(in
Thousands) | |
| Cash paid for amounts included in the measurement
of leases liabilities: | |
| | | |
| | |
| Operating leases | |
$ | 541 | | |
$ | 573 | |
| Finance leases | |
$ | 64 | | |
$ | 44 | |
| | |
| | | |
| | |
| Right-of-use assets obtained in exchange for
lease obligations: | |
| | | |
| | |
| Operating leases | |
$ | 405 | | |
$ | 752 | |
Undiscounted
Cash Flows
The
table below reconciles the undiscounted cash flows for each of the first five years and total of the remaining years to the finance lease
liabilities and operating lease liabilities recorded on the balance sheet.
SCHEDULE
OF FINANCE LEASE LIABILITIES AND OPERATING LEASE LIABILITIES
| | |
Operating Leases | | |
Finance
Leases | |
| Year
ended December 31, | |
| | | |
| | |
| 2024 | |
$ | 346 | | |
$ | 26 | |
| 2025 | |
| 342 | | |
| - | |
| 2026 | |
| 318 | | |
| - | |
| 2027 | |
| 284 | | |
| - | |
| 2028 | |
| 225 | | |
| - | |
| Thereafter | |
| 518 | | |
| - | |
| Total minimum lease
payments | |
| 2,033 | | |
| 26 | |
| Less: amount of lease
payments representing interest | |
| (491 | ) | |
| - | |
| Present value of future
minimum lease payments | |
| 1,542 | | |
| 26 | |
| Less: Current leases
obligations | |
| (234 | ) | |
| (25 | ) |
| Long-term leases obligations | |
$ | 1,308 | | |
$ | 1 | |
Operating
lease right-of-use assets by geographical location were as follows:
SCHEDULE
OF RIGHT-OF-USE ASSETS BY GEOGRAPHICAL LOCATION
| | |
December
31, | |
| | |
2024 | | |
2023 | |
| | |
(in
thousands) | |
| | |
| | |
| |
| Greece | |
$ | - | | |
$ | - | |
| Israel | |
| - | | |
| 292 | |
| U.S. | |
| - | | |
| 59 | |
| Total | |
$ | - | | |
$ | 351 | |
|