Climb Global Solutions, Inc. Leases Disclosure
5. Right-of-use Asset and Lease Liability
The Company has entered into operating leases for office and warehouse facilities, which have terms at lease commencement that range from 1 years to 11 years. The Company determines if an arrangement is a lease at inception. Leases with an initial term of 12 months or less are not recorded on the Consolidated Balance Sheets and lease expense for these leases is recognized on a straight-line basis over the lease term.
Right-of-use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized at commencement date of the lease based on the present value of the lease payments over the lease term. As our leases do not provide a readily determinable implicit rate, we use an incremental borrowing rate based on the information available at commencement date, including lease term, in determining the present value of future payments. The operating lease asset also includes any lease payments made and excludes lease incentives. Operating lease expense is recognized on a straight-line basis over the lease term and included in selling, general and administrative expenses.
Information related to the Company’s right-of-use assets and related lease liabilities were as follows:
| | Year ended | |||||||||||
| | December 31, | |||||||||||
| | 2025 | 2024 | 2023 | |||||||||
| Cash paid for operating lease liabilities | $ | 853 | $ | 725 | $ | 627 | ||||||
| Right-of-use assets obtained in exchange for new operating lease obligations | $ | 1,061 | $ | 1,549 | $ | — | ||||||
| Weighted-average remaining lease term (years) | 4.9 | 3.5 | 3.2 | |||||||||
| Weighted-average discount rate | 6.5 | % | 5.5 | % | 3.6 | % | ||||||
Maturities of lease liabilities as of December 31, 2025 were as follows:
| 2026 | $ | 969 | ||
| 2027 | 559 | |||
| 2028 | 339 | |||
| 2029 | 317 | |||
| 2030 | 88 | |||
| Thereafter | 321 | |||
| 2,593 | ||||
| Less: imputed interest | (586 | ) | ||
| Total lease liabilities | $ | 2,007 | ||
| Lease liabilities, current portion | 791 | |||
| Lease liabilities, net of current portion | 1,216 | |||
| Total lease liabilities | $ | 2,007 | ||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 27, 2026 | Showing above |
| 2024 | Mar 11, 2025 | |
| 2023 | Mar 5, 2024 | |
| 2022 | Mar 16, 2023 | |
| 2021 | Mar 9, 2022 | |
| 2020 | Mar 16, 2021 | |
| 2019 | Mar 4, 2020 | |
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.