LEXICON PHARMACEUTICALS, INC.LXRX

LEXICON PHARMACEUTICALS, INC. Commitments Disclosure

10-KFiled Mar 5, 20262 min read
Commitments and Contingencies
 
Operating Lease Obligations.  Lexicon’s operating leases include leases of office space in The Woodlands, Texas and Bridgewater, New Jersey that will expire in January 2031 and January 2034, respectively. In September 2025, Lexicon began a new lease agreement for 25,000 square feet of office space in The Woodlands, Texas. The term of the new Texas lease extends through January 2031 and provides for escalating annual office rent and other fixed payments starting at approximately $0.8 million and increasing to approximately $0.9 million in the final year of the lease for total undiscounted cash payments of $4.5 million. In September 2025, the Company recorded a right-of use asset and right-of-use liability of approximately $3.2 million related to this new office lease based on the present value of future lease payments to be made over the expected lease term using a discount rate of approximately 11.9%. The New Jersey lease provides for escalating yearly base rent payments which started at approximately $0.8 million and increase to approximately $1.0 million in the final year of the lease.

As of December 31, 2025 and 2024, the right-of-use assets for the office space leases of $7.3 million and $4.8 million, respectively, are separately included in operating lease right-of-use-assets in the consolidated balance sheet. Current liabilities relating to the leases are included in accrued liabilities in the consolidated balance sheet (as further described in Note 5) and long-term liabilities of $6.6 million and $4.6 million, respectively, as of December 31, 2025 and 2024, are included in other long-term liabilities in the consolidated balance sheet.

During the years ended December 31, 2025 and 2024, the Company incurred lease expense of $1.7 million and $1.6 million, respectively. During the years ended December 31, 2025 and 2024, the Company made cash payments for lease liabilities of $1.4 million each year. As of December 31, 2025 and 2024, the weighted-average remaining lease terms were 7.0 years and 8.6 years, respectively, with weighted-average discount rates of 10.5% and 9.7%, respectively.


The following table reconciles the undiscounted cash flows of the operating lease liability to the recorded lease liability at December 31, 2025:
 
 
 (in thousands)
2026$1,649 
20271,683 
20281,718 
20291,753 
20301,863 
Thereafter2,979 
Total undiscounted operating lease liability$11,645 
Less: amount of lease payments representing interest(3,411)
Present value of future lease payments8,234 
Less: short-term operating lease liability(1,642)
Long-term operating lease liability$6,592 
Legal Proceedings.  Lexicon is from time to time party to claims and legal proceedings that arise in the normal course of its business and that it believes will not have, individually or in the aggregate, a material adverse effect on its results of operations, financial condition or liquidity.

Historical Timeline

Fiscal YearFiled
2025Mar 5, 2026Showing above
2024Mar 7, 2025
2023Mar 25, 2024
2021Mar 10, 2022
2020Mar 12, 2021
2019Mar 12, 2020
2018Mar 15, 2019
2017Mar 1, 2018
2016Mar 6, 2017
2015Mar 11, 2016

About Commitments Disclosures

Commitments and contingencies disclosures catalog a company's off-balance-sheet obligations and legal exposures — purchase commitments, guarantee arrangements, pending litigation, and regulatory proceedings. These items represent potential future cash outflows that may not appear as liabilities on the balance sheet until they become probable and estimable.

Key signals: litigation reserves and disclosed loss ranges quantify management's estimate of legal exposure, but unquantified "reasonably possible" losses often represent the larger risk. Watch for changes in language around pending cases — shifts from "remote" to "reasonably possible" or increases in estimated loss ranges signal deteriorating outcomes. Unconditional purchase obligations and take-or-pay contracts create fixed cost structures that reduce operational flexibility. Guarantee arrangements for subsidiaries or joint ventures can create cascading obligations. Compare the total commitment schedule against projected free cash flow to assess whether the company can meet its obligations without additional financing.

Other Available Disclosures

Income TaxesRevenueEarnings Per ShareFair ValuePP&EGoodwill & IntangiblesSegmentsDebtStock CompensationNew StandardsPay vs Performance