ONE STOP SYSTEMS, INC. Leases Disclosure
N0TE 13 - LEASES
Leases
The Company leases its offices, manufacturing, and warehouse facility in San Diego County under a non-cancelable operating lease. Our corporate headquarters are in a leased space comprising approximately 29,342 square feet in Escondido, California under a lease that was last modified and extended in and expires in . The Company also leases a facility in Salt Lake City, Utah that houses our Ion software development team. This lease expired on June 30, 2025, and the Company extended the lease for an additional 12 months, with the lease commencing in July 2025 and expiring in . In the lease extension, the leased space was reduced from 3,208 square feet to 925 square feet. Additionally, we leased a 1,632 square foot facility located in Anaheim, California. This lease expired on , and the Company extended the lease through January 31, 2026. Upon expiration of the lease on January 31, 2026, the Company did not renew the lease and exited the facility. For the years ended December 31, 2025 and 2024, rent expense associated with continuing operations was $602,518 and $581,780, respectively.
In addition to leases for physical facilities the Company also leases certain office equipment. For the years ended December 31, 2025 and 2024, lease expenses associated with continuing operations, excluding office leases, was $0 and $3,794, respectively.
Other information related to leases associated with continuing operations as of the years ended December 31, 2025 and 2024 are as follows:
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For the Year Ended December 31, |
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2025 |
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2024 |
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Operating lease expense |
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$ |
602,518 |
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$ |
581,780 |
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Total lease expense |
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$ |
602,518 |
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$ |
581,780 |
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Cash paid for amounts included in the measurement of operating lease liabilities: |
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Operating cash flows from operating leases |
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$ |
440,993 |
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$ |
415,290 |
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Weighted-average remaining lease term - operating leases |
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56.7 months |
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67.8 months |
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Weighted-average discount rate - operating leases |
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13.7 |
% |
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13.7 |
% |
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The following table presents maturity of the Company's operating lease liabilities as of December 31, 2025:
Year |
Operating Leases |
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2026 |
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398,893 |
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2027 |
|
403,771 |
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2028 |
|
419,922 |
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2029 |
|
436,719 |
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2030 |
|
298,808 |
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Total lease payments |
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1,958,113 |
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Less: Amount representing interest |
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(489,154 |
) |
Present value of lease payment |
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1,468,959 |
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Less: current portion of operating lease obligation |
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(219,097 |
) |
Operating lease obligation, net of current portion |
$ |
1,249,862 |
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 18, 2026 | Showing above |
| 2024 | Mar 19, 2025 | |
| 2023 | Mar 21, 2024 | |
| 2022 | Mar 23, 2023 | |
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.