Property and Equipment, Net
|12 Months Ended|
Dec. 31, 2021
|Property, Plant and Equipment [Abstract]|
|PROPERTY AND EQUIPMENT, NET||
NOTE 5 – PROPERTY AND EQUIPMENT, NET
Property and equipment consisted of the following:
As of December 31, 2021, the Company had capitalized $540 related to capital leases and the accumulated depreciation was $270.
As of December 31, 2021 and 2020, the Company had capitalized $3,857 and $260, respectively, related to capital leases and the accumulated depreciation was $489 and $31, respectively.
Depreciation and amortization expense related to property and equipment during the years ended December 31, 2021 and 2020 was $34,479 and $79,263, respectively.
During the year ended December 31, 2020, as a result of the impairment test on long-lived assets described in “Note 6 – Goodwill and Intangible Assets,” the Company recorded an impairment charge of $140,273 to reduce the carrying value of property and equipment to its fair value on the date of impairment. No impairment of long-lived assets was recorded for the year ended December 31, 2021.
In May 2021, the Company announced its commitment to becoming an all-electric pressure pumping services provider and since then has sold most of its legacy, diesel-powered pressure pumping equipment. As of December 31, 2021, the Company has classified $2,043 in net book value of diesel pressure pumping equipment, which was subsequently sold in January 2022, as assets held for sale on the consolidated balance sheet.
During the year ended December 31, 2021, the Company received $105,963 in proceeds from the sale of equipment, of which $44,450 was for assets classified as held for sale and $35,000 was a result of sale-leaseback transaction (described below). In January 2022, the Company sold its remaining assets classified as held for sale for $2,110 in proceeds. The Company used the proceeds received from the asset sales to pay down the principal of its Senior Secured Term Loan.
The Company recognized a gain of $21,896 and a loss of $7,112 from disposal of assets for the years ended December 31, 2021 and 2020, respectively.
In October 2021, the Company entered into an agreement to sell certain power generation equipment for proceeds of $35,000. Concurrent with the sale of the assets, the Company entered into a twelve month lease agreement whereby the Company agreed to lease back the assets. In accordance with ASC 840, the Company accounted for the sale as a sale-leaseback transaction and accounted for the lease as a short-term operating lease. The Company deferred $7,410 of the gain from disposal of assets to accrued expenses and other current labilities to amortize over the minimum terms of the lease.
The entire disclosure for long-lived, physical asset used in normal conduct of business and not intended for resale. Includes, but is not limited to, work of art, historical treasure, and similar asset classified as collections.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef