| Accounting Policies | 2.
Accounting Policies Principles of Consolidation The consolidated financial statements include
the accounts of the Company and its wholly-owned subsidiaries, MTI Instruments and EcoChain. All intercompany balances and transactions
are eliminated in consolidation. Use of Estimates The consolidated financial statements of
the Company have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP), which require management
to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates. Inventories Inventories are valued at the lower of
cost (first-in, first-out) or net realizable value. The Company periodically reviews inventory quantities on hand and records a
provision for excess, slow moving and obsolete inventory based primarily on our estimated forecast of product demand, as well as
based on historical usage. The Company also provides estimated inventory allowances for inventory whose carrying value is in excess
of net realizable value. Demand and usage for products and materials can fluctuate significantly. A significant decrease in demand
for our products could result in a short-term increase in the cost of inventory purchases and an increase of excess inventory quantities
on hand. Although the Company makes every effort to assure the accuracy of our forecasts of future product demand, any significant
unanticipated changes in demand could have a significant impact on the value of our inventory and our reported operating results.
If changes in market conditions result in reductions in the estimated net realizable value of our inventory below our previous
estimate, the Company would increase our reserve in the period in which we made such a determination and record a charge to cost
of product revenue. Property, Plant, and Equipment Property, plant and equipment are stated
at cost and depreciated using the straight-line method over their estimated useful lives as follows:
Leasehold improvements Lesser of the life of the lease or the useful life of the improvement
Computers and related software 3 to 5 years
Machinery and equipment 3 to 10 years
Office furniture, equipment and fixtures 2 to 10 years Significant additions or improvements extending
assets' useful lives are capitalized; normal maintenance and repair costs are expensed as incurred. The costs of fully depreciated
assets remaining in use are included in the respective asset and accumulated depreciation accounts. When items are sold or retired,
related gains or losses are included in net (loss) income. Income Taxes The Company is subject to income taxes
in the U.S. (federal and state). As part of the process of preparing our consolidated financial statements, the Company calculates
income taxes for each of the jurisdictions in which the Company operates. This involves estimating actual current taxes due together
with assessing temporary differences resulting from differing treatment for tax and accounting purposes that are recorded as deferred
tax assets and liabilities, loss carryforwards and tax credit carryforwards, for which income tax benefits are expected to be realized
in future years. A valuation allowance has been established to reduce deferred tax assets, if it is more likely than not that all,
or some portion, of such deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates is recognized
in the period that includes the enactment date. Significant management judgment is required
in determining the Company's provision for income taxes, deferred tax assets and liabilities, and any valuation allowance recorded
against the Company's net deferred tax assets. The Company considers all available evidence, both positive and negative, such as
historical levels of income and future forecasts of taxable income amongst other items in determining the Company's valuation allowance.
In addition, the Company's assessment requires the Company to schedule future taxable income in accordance with accounting standards
that address income taxes to assess the appropriateness of a valuation allowance, which further requires the exercise of significant
management judgment. The Company accounts for taxes in accordance
with the asset and liability method of accounting for income taxes. Under this method, the Company must recognize the tax benefit
from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the
taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from
such a position are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate
resolution. The impact of the Company's reassessment of its tax positions for these standards did not have a material impact on
its results of operations, financial condition, or liquidity. The Company is currently subject to audit
in various jurisdictions, and these jurisdictions may assess additional income tax liabilities against us. Developments in an audit,
litigation, or in applicable laws, regulations, administrative practices, principles, and interpretations could have a material
effect on the Company's operating results or cash flows in the period or periods in which such developments occur, as well as for
prior and in subsequent periods. Tax laws, regulations, and administrative
practices in various jurisdictions may be subject to significant change, with or without notice, due to economic, political, and
other conditions, and significant judgment is required in evaluating and estimating the Company's provision and accruals for these
taxes. There are many transactions that occur during the ordinary course of business for which the ultimate tax determination is
uncertain. The Company's effective tax rates could be affected by numerous factors, such as intercompany transactions, earnings
being lower than anticipated in jurisdictions where the Company has lower statutory rates and higher than anticipated in jurisdictions
where the Company has higher statutory rates, the applicability of special tax regimes, losses incurred in jurisdictions for which
the Company is not able to realize the related tax benefit, changes in foreign currency exchange rates, entry into new businesses
and geographies, changes to its existing businesses and operations, acquisitions and investments and how they are financed, changes
in the Company's stock price, changes in its deferred tax assets and liabilities and their valuation, and changes in the relevant
tax, accounting, and other laws, regulations, administrative practices, principles, and interpretations. Equity Investment - Soluna The equity investment in Soluna is carried
at the cost of investment and is $750 thousand as of December 31, 2020. The Company owns approximately 1.86% of Soluna's stock,
calculated on a fully-diluted basis, as of December 31, 2020. Equity Investments without Readily
Determinable Fair Values Our equity investment in Soluna is accounted
for under the measurement alternative. Equity securities measured and recorded using the measurement alternative are recorded at
cost minus impairment, if any, plus or minus changes resulting from qualifying observable price changes. Adjustments resulting
from impairments and observable price changes are recorded in the income statement. There was no impairment of investment
recognized in 2020. Equity Method Investments The Company's consolidated net income will
include our proportionate share, if any, of the net income or loss of our equity method investee. When the Company records its
proportionate share of net income, it increases equity income (loss), net in our consolidated statements of operations and our
carrying value in that investment. Conversely, when the Company records its proportionate share of a net loss, it decreases equity
income (loss), net in our consolidated statements of operations and our carrying value in that investment. When the Company's carrying
value in an equity method investee company has been reduced to zero, no further losses are recorded in the Company's financial
statements unless the Company guaranteed obligations of the investee company or has committed additional funding. When the investee
company subsequently reports income, the Company will not record its share of such income until it equals the amount of its share
of losses not previously recognized. The Company records its investment in MeOH
Power, Inc. using the equity method of accounting. The fair value of the Company's interest in MeOH Power, Inc. has been determined
to be $0 as of December 31, 2020 and December 31, 2019, based on MeOH Power, Inc.'s net position and expected cash flows. As of
December 31, 2020, the Company retained its ownership of approximately 47.5% of MeOH Power, Inc.'s outstanding common stock, or
75,049,937 shares. The number of shares of MeOH Power, Inc.'s common stock authorized for issuance is 240,000,000 as of December
31, 2020. Fair Value Measurement The estimated fair value of certain financial
instruments, including cash, accounts receivable and short-term debt approximates their carrying value due to their short maturities
and varying interest rates. "Fair value" is the price that would be received to sell an asset or transfer a liability
in an orderly transaction between market participants at the measurement date. The Company utilizes valuation techniques that maximize
the use of observable inputs and minimize the use of unobservable inputs. Based on the observability of the inputs used in the
valuation methods, the Company is required to provide the following information according to the fair value accounting standards.
These standards established a fair value hierarchy as specified that ranks the quality and reliability of the information used
to determine fair values. Financial assets and liabilities are classified and disclosed in one of the following three categories: Level
1: Level
2: Level
3: Revenue Recognition Product Revenue Product revenue consists of revenue recognized
from MTI Instruments' product lines. In general, the Company determines revenue recognition by: (1) identifying the contract, or
contracts, with the customer; (2) identifying the performance obligations in the contract; (3) determining the contract price;
(4) allocating the transaction price to performance obligations in the contract; and (5) recognizing revenue when, or as, the performance
obligations are satisfied by transferring the promised goods or services. Based on past experience, the Company reasonably
estimates its returns and warranty reserves. Revenue is presented net of discounts and allowances, which are determined when
the sale is negotiated. The nature of the Company's contracts do not give rise to variable consideration. The Company enters
into contracts that can include various combinations of products and services, which are generally capable of being distinct and
accounted for as separate performance obligations. If the product requires that the Company
provide installation, all revenue related to the product is deferred and recognized upon the completion of the installation. If
the product requires specific customer acceptance criteria, such as on-site customer acceptance and/or acceptance after install,
then revenue is deferred until customer acceptance occurs or the acceptance provisions lapse, unless the Company can objectively
and reliably demonstrate that the criteria specified in the acceptance provisions is satisfied. The Company may also record unearned
revenues, which include payments for other offerings for which we have been paid in advance. The resulting revenue would be earned
when we transfer control of the product or service. As of December 31, 2020 and December 31, 2019, the Company had no deferred
or unearned revenue. MTI Instruments currently has distributor
agreements in place for the international sale of general instrument and semiconductor products in certain global regions. Such
agreements grant a distributor the right of first refusal to act as distributor for such products in the distributor's territory.
In return, the distributor agrees to not market other products which are considered by MTI Instruments to be in direct competition
with MTI Instruments' products. The distributor is allowed to purchase MTI Instruments' equipment at a price which is discounted
off the published domestic/international list prices. Such list prices can be adjusted by MTI Instruments during the term of the
distributor agreement. Generally, payment terms with the distributor are standard net 30 days; however, on occasion, extended payment
terms have been granted. Title and risk of loss of the product passes to the distributor upon delivery to the independent carrier
(standard "free-on-board" factory), and the distributor is responsible for any required training and/or service with
the end-user. The sale (and subsequent payment) between MTI Instruments and the distributor is not contingent upon the successful
resale of the product by the distributor. Distributor sales are covered by MTI Instruments' standard one-year warranty and there
are no special return policies for distributors. The transaction price is determined based
on the consideration to which the Company will be entitled in exchange for transferring services to the customer. If the contract
contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts
that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based
on a relative standalone selling price basis unless the transaction price is variable and meets the criteria to be allocated entirely
to a performance obligation or to a distinct good or service that forms part of a single performance obligation. The Company determines
standalone selling price based on the price at which the performance obligation is sold separately. If the standalone selling price
is not observable through past transactions, the Company estimates the standalone selling price taking into account available information
such as market conditions and internally approved pricing guidelines related to the performance obligations. Shipping and handling charges billed to
customers is a pass-through from the freight forwarder and is included in product revenue. Cost of Product Revenue Cost of product revenue includes material,
labor, overhead and shipping and handling costs. Cryptocurrency Revenue Cryptocurrency revenue consists of revenue
recognized from EcoChain's cryptocurrency mining facility. Revenue is recognized at the cryptocurrency's realized cash value based
upon the rates at cryptocurrency exchanges where we are registered. Cryptocurrencies are earned when the miners solve complex computations
and cryptocurrency is issued as a result. The mined cryptocurrency is immediately paid to the Coinbase wallet. Cryptocurrency is
converted to U.S. dollars daily, as EcoChain is not in the business of accumulating cryptocurrency on its balance sheet for speculative
gains. Cost of Cryptocurrency Revenue Cost of cryptocurrency revenue includes
direct utility costs as well as overhead costs that relate to the operations of EcoChain's cryptocurrency mining facility. Accounts Receivable and Allowance for Doubtful Accounts Trade accounts receivable are stated at
the invoiced amount billed to customers and do not bear interest. An allowance for doubtful accounts, if necessary, represents
the Company's best estimate of the amount of probable credit losses in its existing accounts receivable. The Company determines
the allowance based on historical write-off experience and current exposures identified. The Company reviews its allowance for
doubtful accounts monthly. Past due balances over 90 days and over a specified amount are reviewed individually for collectability.
All other balances are reviewed on a pooled basis by type of receivable. Account balances are charged off against the allowance
when the Company believes it is probable the receivable will not be recovered. The Company does not have any off-balance-sheet
credit exposure related to its customers. The Company's allowance for doubtful accounts was $0 at both December 31, 2020 and December
31, 2019. Payment terms and conditions vary by contract
type, although terms generally include a requirement of payment within 30 days. In instances where the timing of revenue recognition
differs from the timing of invoicing, we have determined our contracts generally do not include a significant financing component.
The primary purpose of the Company's invoicing terms is to provide customers with simplified and predictable ways of purchasing
our products and services, not to receive financing from its customers. The Company recognizes an asset for the
incremental costs of obtaining a contract with a customer, if the Company expects the benefit of those costs to be longer than
one year. As of December 31, 2020 and December 31, 2019, the Company has recorded no capitalized costs to obtain a contract. The Company applies the practical expedient
to expense costs as incurred for costs to obtain a contract when the amortization period would have been one year or less. These
costs include our internal sales force compensation programs as we have determined annual compensation is commensurate with annual
sales activities. Warranty The Company accrues a warranty liability
at the time product revenue is recorded based on historical experience. The liability is reviewed during the year and is adjusted,
if appropriate, to reflect new product offerings or changes in experience. Actual warranty claims are tracked by product line.
Warranty liability was $22 thousand and $16 thousand as of December 31, 2020 and 2019, respectively. Warranty expense was $11 thousand
and $1 thousand for 2020 and 2019, respectively. Long-Lived Assets The Company accounts for impairment or
disposal of long-lived assets in accordance with accounting standards that address the financial accounting and reporting for the
impairment or disposal of long-lived assets, specify how impairment will be measured, and how impaired assets will be classified
in the consolidated financial statements. On a quarterly basis, the Company analyzes the status of its long-lived assets at each
subsidiary for potential impairment. As of December 31, 2020, the Company does not believe that any of its long-lived assets have
suffered any type of impairment that would require an adjustment to that asset's recorded value. Cash and Cash Equivalents Cash and cash equivalents consist of cash
and highly liquid short-term investments with original maturities of less than three months. Net Income per Share The Company computes basic income per common
share by dividing net income by the weighted average number of common shares outstanding during the reporting period. Diluted income
per share reflects the potential dilution, if any, computed by dividing income by the combination of dilutive common share equivalents,
comprised of shares issuable under outstanding investment rights, warrants and the Company's share-based compensation plans, and
the weighted average number of common shares outstanding during the reporting period. Dilutive common share equivalents include
the dilutive effect of in-the-money stock options, which are calculated based on the average share price for each period using
the treasury stock method. Under the treasury stock method, the exercise price of a stock option and the amount of compensation
cost, if any, for future service that the Company has not yet recognized are assumed to be used to repurchase shares in the current
period. Share-Based Payments The Company grants options to purchase
our common stock and award restricted stock to our employees and directors under our equity incentive plans. The benefits provided
under these plans are share-based payments and the Company accounts for stock-based awards exchanged for employee service in accordance
with the appropriate share-based payment accounting guidance. Stock-based compensation represents the cost related to stock-based
awards granted to employees and directors. The Company measures stock-based compensation cost at grant date based on the estimated
fair value of the award and recognizes the cost as expense on a straight-line basis in accordance with the vesting of the options
(net of estimated forfeitures) over the option's requisite service period. The Company estimates the fair value of stock-based
awards on the grant date using a Black- Scholes valuation model. The Company uses the fair value method of accounting with the
modified prospective application, which provides for certain changes to the method for valuing share-based compensation. The valuation
provisions apply to new awards and to awards that are outstanding on the effective date and subsequently modified. Under the modified
prospective application, prior periods are not revised for comparative purposes. Stock-based compensation expense is recorded in
the lines titled "Cost of product revenue," "Selling, general and administrative expenses" and "Research
and product development expenses" in the Consolidated Statements of Operations based on the employees' respective functions. The Company records deferred tax assets
for awards that potentially can result in deductions on the Company's income tax returns based on the amount of compensation cost
that would be recognized upon issuance of the award and the Company's statutory tax rate. All income tax effects of awards, including
excess tax benefits, recognized on stock-based compensation expense are reflected in the Consolidated Statements of Operations
as a component of the provision for income taxes on a prospective basis. The determination of the fair value of
share-based payment awards on the date of grant using an option-pricing model is affected by the Company's stock price as well
as assumptions regarding a number of complex and subjective variables. These variables include the Company's expected stock price
volatility over the term of the awards, actual and projected employee stock option exercise behaviors, risk-free interest rate,
and expected dividends. Theoretical valuation models and market-based
methods are evolving and may result in lower or higher fair value estimates for share-based compensation. The timing, readiness,
adoption, general acceptance, reliability, and testing of these methods is uncertain. Sophisticated mathematical models may require
voluminous historical information, modeling expertise, financial analyses, correlation analyses, integrated software and databases,
consulting fees, customization, and testing for adequacy of internal controls. For purposes of estimating the fair value
of stock options granted using the Black-Scholes model, the Company uses the historical volatility of its stock for the expected
volatility assumption input to the Black-Scholes model, consistent with the accounting guidance. The risk-free interest rate is
based on the risk-free zero-coupon rate for a period consistent with the expected option term at the time of grant. The Company
paid a special dividend during the year ended December 31, 2019 and did not pay any dividends during the year ended December 31,
2020. The Company is required to assume a dividend yield as an input to the Black-Scholes model. Since the 2019 dividend was a
special dividend and the Company does not anticipate paying any cash dividends in the foreseeable future, the Company therefore
used an expected dividend yield of zero in the option valuation model. The expected option term is calculated based on our historical
forfeitures and cancellation rates. The fair value of restricted stock awards
is based on the market close price per share on the grant date. The Company expenses the compensation cost of these awards as the
restriction period lapses, which is typically a one- to three-year service period to the Company. The shares represented by restricted
stock awards are outstanding at the grant date, and the recipients are entitled to voting rights with respect to such shares upon
issuance. Concentration of Credit Risk Financial instruments that subject the
Company to concentrations of credit risk principally consist of cash equivalents and trade accounts receivable. The Company's trade
accounts receivable are primarily from sales to commercial customers, the U.S. government and state agencies. The Company does
not require collateral and has not historically experienced significant credit losses related to receivables from individual customers
or groups of customers in any particular industry or geographic area. The Company has cash deposits in excess
of federally insured limits but does not believe them to be at risk. Research and Development Costs The Company expenses research and development
costs as incurred. The Company incurred research and development costs of approximately $1.5 million and $1.4 million, which was
entirely related to MTI Instruments, for the years ended December 31, 2020 and 2019, respectively. Advertising Costs The Company expenses advertising costs
as incurred. The Company incurred advertising costs of approximately $39 thousand and $45 thousand, which was entirely related
to MTI Instruments, for the years ended December 31, 2020 and 2019, respectively. Other Comprehensive Income The Company had no other comprehensive
income items for the years ended December 31, 2020 and 2019. Leases The Company determines if an arrangement
is a lease at inception. Operating leases are included in operating lease right-of-use ("ROU") assets and operating lease
liability on our consolidated balance sheets. The Company did not have any finance leases as of December 31, 2020 or December 31,
2019. Operating lease ROU assets and operating
lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement
date. As most of the Company's leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on
the information available at commencement date in determining the present value of future payments. The operating lease ROU assets
also include any lease payments made and excludes lease incentives and initial direct costs incurred. The Company's lease terms
may include options to extend or terminate its leases when it is reasonably certain that the Company will exercise those options.
Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease
and non-lease components, which are generally accounted for separately. For real estate leases, the Company accounts for lease
components together with non-lease components (e.g. common-area maintenance). Accounting Updates Not Yet Effective Changes to U.S. GAAP are established by
the Financial Accounting Standards Board (the FASB) in the form of accounting standard updates (ASUs) to the FASB's Accounting
Standards Codification (ASC). The Company considered the applicability and impact of all ASUs. ASUs not mentioned below were assessed
and determined to be either not applicable or are expected to have minimal impact on our consolidated financial position or results
of operations. In June 2016, the FASB issued ASU 2016-13
(Financial Instruments - Credit Losses (Topic 326)) and its subsequent amendments to the initial guidance within ASU 2018-19, ASU
2019-04, ASU 2019-05, ASU 2019-10, ASU 2019-11 and ASU 2020-02, respectively (collectively, Topic 326). Topic 326 changes how entities
will measure credit losses for most financial assets and certain other instruments that are not accounted for at fair value through
net income. This standard replaces the existing incurred credit loss model and establishes a single credit loss framework based
on a current expected credit loss model for financial assets carried at amortized cost, including loans and held-to- maturity debt
securities. The current expected loss model requires an entity to estimate credit losses expected over the life of the credit exposure
upon initial recognition of that exposure when the financial asset is originated or acquired, which will generally result in earlier
recognition of credit losses. This standard also requires expanded credit quality disclosures. For available-for-sale debt securities,
entities will be required to record allowances rather than reduce the carrying amount, as they do today under the other-than-temporary
impairment model. This standard also simplifies the accounting model for purchased credit-impaired debt securities and loans. This
standard will affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures,
reinsurance receivables, and any In December 2019, the FASB issued ASU 2019-12
(Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes). This standard removes exceptions to the general principles
in Topic 740 for allocating tax expense between financial statement components, accounting basis differences stemming from an ownership
change in foreign investments and interim period income tax accounting for year-to-date losses that exceed projected losses. The
standard will be effective for the Company for annual reporting periods beginning after December 15, 2020 and interim periods within
those fiscal years, and while early adoption is permitted, the Company does not expect to elect that option. The Company is currently
evaluating the impact of the adoption of this standard on its consolidated financial statements. At this time, the Company does
not expect the adoption of this standard to have a material impact on its consolidated financial statements. In January 2020, the FASB issued ASU 2020-01
(Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging
(Topic 815). This standard clarifies certain interactions between the guidance to account for certain equity securities under
Topic 321, the guidance to account for investments under the equity method of accounting in Topic 323, and the guidance in Topic
815, which could change how an entity accounts for an equity security under the measurement alternative or a forward contract or
purchased option to purchase securities that, upon settlement of the forward contract or exercise of the purchased option, would
be accounted for under the equity method of accounting or the fair value option in accordance with Topic 825, Financial Instruments.
This standard will reduce diversity in practice and increasing comparability of the accounting for these interactions. The standard
will be effective for the Company for annual reporting periods beginning after December 15, 2020 and interim periods within those
fiscal years, and while early adoption is permitted, the Company does not expect to elect that option. The Company is currently
evaluating the impact of the adoption of this standard on its consolidated financial statements. At this time, the Company does
not expect the adoption of this standard to have a material impact on its consolidated financial statements. Accounting Updates Recently Adopted by the Company On January 1, 2020, the Company adopted
ASU No. 2018-18 (Collaborative Arrangements (Topic 808): Clarifying the Interaction Between Topic 808 and Topic 606). A collaborative
arrangement is a contractual arrangement under which two or more parties actively participate in a joint operating activity and
are exposed to significant risk and rewards that depend on the activity's commercial success. This standard clarifies when
certain transactions between collaborative arrangement participants should be accounted for under ASC 606 and incorporates unit-of-account
guidance consistent with ASC 606 to aid in this determination. The adoption of this standard did not have a material impact on
its consolidated financial statements. There have been no other significant changes
in the Company's reported financial position or results of operations and cash flows as a result of its adoption of new accounting
pronouncements or changes to its significant accounting policies that were dis |
