Note 7: Lease

Operating leases

Menlo Park, California Office Lease

In April 2023, Combangio entered into a lease agreement with Menlo Prepi I, LLC, pursuant to which Combangio leases approximately 6,135 square feet of office, laboratory and research and development space in Menlo Park, California. The Company entered into a guaranty of lease agreement guarantying the obligations of Combangio under the lease agreement. The initial term of the lease is for 62 months which commenced on the lease commencement date of July 1, 2023, unless earlier terminated pursuant to the terms of the lease. The lease provides Combangio with an option to extend the lease for an additional five-year term. Combangio was required to make a payment in the amount of $144, as a security deposit pursuant to the lease during the year ended December 31, 2023, which is included in other long-term assets on the consolidated balance sheet as of December 31, 2024. Upon the lease commencement, the Company recorded a right-of-use asset of $2,154 and corresponding $2,133 of lease liability.

As a result of the CHASE trial of KPI-012 decision to cease development, on November 21, 2025, the Company terminated the lease with the landlord and signed a settlement to return the space and release the Company from its obligations and liabilities. The settlement was paid prior to December 31, 2025.

The components of lease expense and related cash flows were as follows:

Year Ended

December 31, 

  ​ ​ ​

2025

  ​ ​ ​

2024

Lease cost

  ​ ​ ​

  ​

  ​ ​ ​

  ​

Operating lease cost

$

546

$

596

Short-term lease cost

37

34

Variable lease cost

179

209

Total lease cost

$

762

$

839

Operating cash outflows from operating leases

$

550

$

581

The weighted average remaining lease term and weighted average discount rate of operating leases were as follows:

December 31, 

December 31,

2025

2024

Weighted average remaining lease term

-

3.7 years

Weighted average discount rate

-

13.1%

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Historical Timeline

Fiscal YearFiled
2025Apr 15, 2026Showing above
2024Mar 31, 2025
2023Mar 29, 2024
2022Mar 3, 2023
2021Mar 29, 2022
2019Feb 12, 2020
2018Mar 12, 2019

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.