Note 6 – Property, Plant and Equipment, and Asset Impairment

For the years ended December 31, 2024 and 2023, property, plant and equipment consisted of the following:

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Depreciation expense for the years ended December 31, 2024 and 2023, was approximately $0.7 million and $1.9 million, respectively, and was recorded in research and development expense in the Statements of Operations.

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Fixed assets – construction in process primarily reflects buildout costs and equipment that have not yet been placed into service.

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Impairment of Long-Lived Assets

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During the second quarter of fiscal year 2024, the Company concluded it had a triggering event requiring assessment of impairment for certain leasehold improvements and the related right-of-use asset. The Company assessed the carrying value of the asset group consisting of the leasehold improvements and right-of-use asset in accordance with ASC 360, given the significant changes to the Company’s operations, operating cash and the repurchase of equipment. The assessment of the recoverability of the asset group concluded that there was impairment on the carrying value of the asset group of approximately $2.6 million, which was allocated on a pro rata basis using the relative carrying amounts of the assets. Approximately $2.2 million of the impairment loss was allocated to the leasehold improvements, with the remaining $0.4 million allocated to the right-of-use asset.