Kalaris Therapeutics, Inc. Leases Disclosure
9. Leases
In February 2025, the Company entered into an operating lease agreement for office space in Berkeley Heights, New Jersey. In accordance with ASC 842, the Company has determined the lease commencement occurred in September 2025 upon substantial completion of lessor-owned improvements. The lease is expected to terminate in December 2031, however, the Company has the option to extend the lease term twice for an additional three years. As of December 31, 2025, it is not reasonably certain that the Company will exercise this option to extend. The Company can terminate the lease after four years and four months after the lease commencement date with a termination penalty of $0.3 million. In addition to the base rent, the Company will pay its share of operating expenses and taxes. The lessor provided a tenant improvement allowance of up to $0.4 million, which the Company fully utilized as of December 31, 2025. The Company is responsible for additional improvement expense incurred in excess of the tenant improvement allowance and has incurred $0.1 million of excess costs as of December 31, 2025. The Company records excess costs as payments in the measurement of lease liabilities.
In connection with the signing of the lease, the Company secured a letter of credit in favor of the lessor in the amount of $0.5 million, which will be reduced to $0.2 million over five years. The letter of credit is recorded as restricted cash in the consolidated balance sheet as of December 31, 2025.
The following table summarizes the presentation of the Company's operating lease on its consolidated balance sheet as of December 31, 2025 (in thousands):
Leases |
|
Balance sheet classification |
|
December 31, |
|
|
Assets: |
|
|
|
|
|
|
Operating lease assets |
|
Operating lease right-of-use assets |
|
$ |
1,475 |
|
Total lease assets |
|
|
|
$ |
1,475 |
|
Liabilities: |
|
|
|
|
|
|
Current: |
|
|
|
|
|
|
Operating lease liabilities |
|
Operating lease liability, current |
|
$ |
316 |
|
Noncurrent: |
|
|
|
|
|
|
Operating lease liabilities |
|
Operating lease liability, long-term |
|
|
1,132 |
|
Total lease liabilities |
|
|
|
$ |
1,448 |
|
The components of lease cost under ASC 842 included within general and administrative expenses in the Company’s consolidated statements of operations and comprehensive loss were as follows for the year ended December 31, 2025 (in thousands):
Lease cost |
|
Year Ended December 31, 2025 |
|
|
Operating lease cost |
|
$ |
117 |
|
Variable lease cost |
|
|
6 |
|
Total lease cost |
|
$ |
123 |
|
As of December 31, 2025, the weighted-average remaining lease term for the operating lease was 6.0 years, and the weighted-average discount rate was 13.12%. Cash paid for amounts included in the measurement of lease liabilities was $0.1 million for the year ended December 31, 2025.
Future minimum annual lease commitments under the Company's non-cancelable operating lease as of December 31, 2025 was as follows (in thousands):
Year ended December 31, |
|
Amount |
|
|
2026 |
|
$ |
335 |
|
2027 |
|
|
342 |
|
2028 |
|
|
349 |
|
2029 |
|
|
356 |
|
2030 |
|
|
363 |
|
Thereafter |
|
|
338 |
|
Total lease payments |
|
|
2,083 |
|
Less: interest |
|
|
(635 |
) |
Present value of operating lease liabilities |
|
$ |
1,448 |
|
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 17, 2026 | Showing above |
| 2024 | Mar 7, 2025 | |
| 2023 | Mar 15, 2024 | |
| 2022 | Feb 15, 2023 | |
| 2021 | Feb 10, 2022 | |
| 2020 | Feb 12, 2021 | |
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.