Phio Pharmaceuticals Corp. Leases Disclosure
5. Leases
The Company leases space for various corporate and research purposes. It is the Company’s policy to apply the provisions of ASC 842 when accounting for arrangements that meet the criteria to be a lease. The Company calculates the lease liability as the present value of the lease’s cash flows using the interest rate implicit in the lease, if determinable. If the rate implicit in the lease is not determinable, the Company uses its incremental borrowing rate. The incremental borrowing rate is defined as the rate the Company would have to pay to borrow on a collateralized basis over the lease term. The Company has elected the accounting policy election available under ASC 842 to not record a lease liability for leases with a term of less than one year.
From April 2014 to March 2024, the Company leased space that was utilized as its corporate headquarters and primary laboratory. The lease expired on March 31, 2024. On March 1, 2024, the Company commenced a lease for a laboratory space located at 17 Briden Street, Worcester, Massachusetts. The lease expired on February 28, 2026. We currently have shared office space at LifeSciences PA located at 411 Swedeland Road, King of Prussia, PA 19406 for access to full working space for normal hours of operations at a fee of $300 per month, which can be cancelled at any time.
The lease for the Company’s corporate headquarters in Worcester, Massachusetts represented all of its significant lease obligations.
Operating lease costs included in operating expense were $31,000 and $58,000 for the years ended December 31, 2025 and 2024, respectively.
Cash paid for the amounts included in the measurement of the operating lease liability on the Company’s consolidated balance sheets and included within changes in the lease liability in the operating activities of the Company’s consolidated statements of cash flows was $60,000 for the year ended December 31, 2024. There was no cash paid for the amounts included in the measurement of the operating lease liability during the year ended December 31, 2025.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 5, 2026 | Showing above |
| 2024 | Mar 31, 2025 | |
| 2023 | Apr 1, 2024 | |
| 2022 | Mar 22, 2023 | |
| 2021 | Mar 22, 2022 | |
| 2020 | Mar 25, 2021 | |
| 2019 | Mar 26, 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.