Solid Power, Inc. Leases Disclosure
Note 14 – Leases
The Company leases its two facilities and certain equipment. Fixed rent generally escalates each year, and the Company is responsible for a portion of the landlords’ operating expenses such as property tax, insurance and common area maintenance.
The Company’s facility in Louisville, Colorado is under a noncancelable operating lease with a maturity date in September 2029. In 2022, the Company amended the lease to incorporate a prior subleased space into the base lease and extend the term of the lease. The Company has the right to renew this lease for an additional five-year period.
On September 1, 2021, the Company entered into an industrial operating lease agreement for its facility in Thornton, Colorado, with the initial term through March 31, 2029. Under this operating lease, the Company has one option to renew for five years, which has been included in the calculation of lease liabilities and right-of-use assets at the adoption date of the lease accounting standard on January 1, 2022, as the exercise of the option was reasonably certain. As the renewal rent has not been negotiated, the Company used an estimated rent rate which approximated the fair market rent at adoption of ASC 842 on January 1, 2022 for the extension period.
The Company has certain equipment leases classified as finance leases as of December 31, 2022.
The Company’s leases do not have any contingent rent payments and do not contain residual value guarantees.
The components of lease expense are as follows:
| December 31, 2022 |
| December 31, 2021 | |||
Finance lease costs: |
|
|
|
| ||
Amortization of right-of-use assets | $ | 92 | $ | — | ||
Interest on lease liabilities |
| 28 |
| — | ||
Operating lease costs |
| 850 |
| — | ||
Total lease expense | $ | 970 | $ | — | ||
The components of cash flow information related to leases are as follows:
| December 31, 2022 |
| December 31, 2021 | |||
Operating outgoing cash flows – finance lease | $ | 24 | $ | — | ||
Financing outgoing cash flows – finance lease |
| 142 |
| — | ||
Operating outgoing cash flows – operating lease |
| 568 |
| — | ||
Right-of-use assets obtained in exchange for new finance lease liabilities |
| 1,014 |
| — | ||
Right-of-use assets obtained in exchange for new operating lease liabilities |
| 8,947 |
| — | ||
| December 31, 2022 |
| |
Finance lease |
|
| |
Weighted-average remaining lease term – finance lease (in years) |
| 3.37 | |
Weighted-average discount rate – finance lease |
| 5.9 | % |
Operating lease |
|
| |
Weighted-average remaining lease term – operating lease (in years) |
| 10.18 | |
Weighted-average discount rate – operating lease |
| 6.9 | % |
As of December 31, 2022, future minimum payments during the next five years and thereafter are as follows:
Fiscal year |
| Finance Lease |
| Operating Lease | ||
2023 | $ | 315 | $ | 1,138 | ||
2024 | 315 | 1,173 | ||||
2025 | 192 | 1,210 | ||||
2026 | 85 | 1,248 | ||||
2027 | 37 | 1,288 | ||||
Thereafter | 16 | 6,571 | ||||
Total | 960 | 12,628 | ||||
Less present value discount | 85 | 3,457 | ||||
Total lease liabilities | $ | 875 | $ | 9,171 | ||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2022 | Mar 1, 2023 | Showing above |
| 2021 | Mar 23, 2022 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.